ATCO has also reported an increase in adjusted earnings in 2008, which excludes certain items not in the normal course of business or a result of regular operations. Adjusted earnings for the year-end 2008, were CAD265.6 million (CAD4.60 per share) compared to CAD221.0 million (CAD3.79 per share) previous year-end. Details are provided in the table below.

Earnings for the fourth quarter of 2008, were CAD74.7 million (CAD1.29 per share) compared to earnings of CAD63.8 million (CAD1.10 per share) year-ago quarter. Adjusted earnings for the fourth quarter of 2008, were CAD72.7 million (CAD1.26 per share) compared to adjusted earnings of CAD47.1 million (CAD0.81 per share) year-ago quarter.

Recent Developments

On December 2, 2008, ATCO Structures said that its contract to design, manufacture and install the 2,000-person workforce housing camp for the Fort Hills Energy Limited Partnership oil sands project north of Fort McMurray has been cancelled. The impact to ATCO Structures of this cancellation will be determined in the first quarter of 2009, once terms have been discussed.

On November 24, 2008, ATCO Power announced the construction of a new energy efficient 86 megawatt natural gas-fired power plant for Horizon Power. The power plant will be constructed adjacent to Horizon’s Karratha Terminal in the Pilbara region of Western Australia. On February 2, 2009, ATCO Power announced that it had entered a CAD100 million credit facility with Commonwealth Bank of Australia to finance the design and construction of the station.

On November 17, 2008, ATCO Midstream announced the purchase of IPL Holdings Inc. (IPLH), a wholly owned subsidiary of Enbridge Inc.

Adjusted earnings for the year-end 2008, increased primarily due to increased international operations in ATCO Structures, improved merchant performance in ATCO Power’s and ATCO Resources’ Alberta generating plants, increased availability and the recognition of insurance proceeds from the Barking outage in ATCO Power’s UK operations. Alberta Utilities Commission (AUC) approved 2008 customer rates in ATCO Gas (ATCO Gas Decision) net of cost increases and suspension of the Carbon lease payments to customers (Carbon rate riders) in ATCO Gas and the impact of the higher 2008 AUC approved customer rates (ATCO Electric Decision) also contributed to the increase in Adjusted Earnings. These increases were incompletely offset by reduced Canadian manufacturing operations in ATCO Structures and lower natural gas storage fees in ATCO Midstream.

Adjusted earnings for the fourth quarter of 2008, increased mainly due to increased international operations in ATCO Structures, improved merchant performance in ATCO Power’s and ATCO Resources’ Alberta generating plants, improved merchant performance and increased availability in ATCO Power’s UK operations, and increased earnings of CAD1.8 million after non-controlling interests due to the change in quarterly depreciation expense allocation in ATCO Gas. These increases were incompletely offset by condensed activity in natural gas liquids (NGL) extraction operations in ATCO Midstream and lower business activity in ATCO Noise Management.

Revenues for the year-end 2008, increased mainly due to increased business activity in ATCO Structures’ operations in South America and Australia and in ATCO Frontec’s operations and higher natural gas fuel purchases recovered on a no-margin basis, improved merchant operations, increased availability and the recognition of insurance proceeds from the Barking outage in ATCO Power’s UK operations. In addition, the 2007 refund of future income tax balances with a corresponding decrease in 2007 revenues, and the impact of the ATCO Electric Decision contributed to the increase in revenues.

Other contributing factors were the ATCO Gas Decision and improved merchant performance in ATCO Power’s and ATCO Resources’ Alberta generating plants. These increases were partially offset by reduced Canadian manufacturing operations in ATCO Structures, the impact of lower exchange rates on conversion of revenues to Canadian dollars in ATCO Power’s UK operations, and lower storage revenues due to the timing and demand of natural gas storage capacity sold and lower storage fees in ATCO Midstream.

Revenues for the fourth quarter of 2008, increased mainly due to increased international and Canadian manufacturing operations in ATCO Structures, higher natural gas fuel purchases recovered on a no-margin basis, improved merchant operations and increased availability in ATCO Power’s UK operations and improved merchant performance in ATCO Power’s and ATCO Resources’ Alberta generating plants. In addition, increased business activity in ATCO Frontec’s operations and the ATCO Gas Decision contributed to the increase in revenues. These increases were partially offset by lower prices for NGL extraction in ATCO Midstream.

Funds generated by operations for the three and year-end 2008, increased primarily due to increased cash earnings and increased deferred availability incentives in Alberta Power (2000).

I am pleased with our 2008 earnings, our very solid balance sheet and the completion of extensive capital programs in 2008, said Nancy Southern, president and chief executive officer, ATCO Group. We are fortunate to be in Alberta where significant utility infrastructure projects are immediately required. The key issue for these major projects will be ensuring a competitive rate of return that will allow access to the scarce capital needed to finance these projects.

ATCO is a Canada based company.