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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Allete Inc | NYSE:ALE | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
3.43 | 5.64% | 64.27 | 65.86 | 61.85 | 62.00 | 1,471,885 | 01:00:00 |
x
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Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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For the quarterly period ended
June 30, 2017
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¨
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Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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For the transition period from ______________ to ______________
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Minnesota
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41-0418150
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(State or other jurisdiction of incorporation or organization)
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(IRS Employer Identification No.)
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Large Accelerated Filer
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Accelerated Filer
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Non-Accelerated Filer
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Smaller Reporting Company
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Emerging Growth Company
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June 30, 2017 and December 31, 2016
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Quarter and Six Months Ended June 30, 2017 and 2016
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Quarter and Six Months Ended June 30, 2017 and 2016
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Six Months Ended June 30, 2017 and 2016
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Abbreviation or Acronym
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Term
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AFUDC
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Allowance for Funds Used During Construction – the cost of both debt and equity funds used to finance regulated utility plant additions during construction periods
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ALLETE
|
ALLETE, Inc.
|
ALLETE Clean Energy
|
ALLETE Clean Energy, Inc. and its subsidiaries
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ALLETE Properties
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ALLETE Properties, LLC and its subsidiaries
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ALLETE Transmission Holdings
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ALLETE Transmission Holdings, Inc.
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ASC
|
Accounting Standards Codification
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ATC
|
American Transmission Company LLC
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Bison
|
Bison Wind Energy Center
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BNI Energy
|
BNI Energy, Inc. and its subsidiary
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Boswell
|
Boswell Energy Center
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Camp Ripley
|
Camp Ripley Solar Array
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CO
2
|
Carbon Dioxide
|
Company
|
ALLETE, Inc. and its subsidiaries
|
CIP
|
Conservation Improvement Program
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Cliffs
|
Cliffs Natural Resources Inc.
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CSAPR
|
Cross-State Air Pollution Rule
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DC
|
Direct Current
|
EIS
|
Environmental Impact Statement
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EPA
|
United States Environmental Protection Agency
|
ERP Iron Ore
|
ERP Iron Ore, LLC
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ESOP
|
Employee Stock Ownership Plan
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FASB
|
Financial Accounting Standards Board
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FERC
|
Federal Energy Regulatory Commission
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Form 10-K
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ALLETE Annual Report on Form 10-K
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Form 10-Q
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ALLETE Quarterly Report on Form 10-Q
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GAAP
|
Generally Accepted Accounting Principles in the United States of America
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GHG
|
Greenhouse Gases
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GNTL
|
Great Northern Transmission Line
|
Invest Direct
|
ALLETE’s Direct Stock Purchase and Dividend Reinvestment Plan
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IRP
|
Integrated Resource Plan
|
Item ___
|
Item ___ of this Form 10-Q
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kV
|
Kilovolt(s)
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kW / kWh
|
Kilowatt(s) / Kilowatt-hour(s)
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Laskin
|
Laskin Energy Center
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MACT
|
Maximum Achievable Control Technology
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Magnetation
|
Magnetation, LLC
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Manitoba Hydro
|
Manitoba Hydro-Electric Board
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MATS
|
Mercury and Air Toxics Standards
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Mesabi Metallics
|
Mesabi Metallics Company, LLC (formerly Essar Steel Minnesota, LLC)
|
Minnesota Power
|
An operating division of ALLETE, Inc.
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Minnkota Power
|
Minnkota Power Cooperative, Inc.
|
Abbreviation or Acronym
|
Term
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MISO
|
Midcontinent Independent System Operator, Inc.
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Montana-Dakota Utilities
|
Montana-Dakota Utilities Co., a division of MDU Resources Group, Inc.
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MPCA
|
Minnesota Pollution Control Agency
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MPUC
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Minnesota Public Utilities Commission
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MW / MWh
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Megawatt(s) / Megawatt-hour(s)
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NAAQS
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National Ambient Air Quality Standards
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NDPSC
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North Dakota Public Service Commission
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NOL
|
Net Operating Loss
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NO
2
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Nitrogen Dioxide
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NO
X
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Nitrogen Oxides
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Northern States Power
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Northern States Power Company, a subsidiary of Xcel Energy Inc.
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Note ___
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Note ___ to the Consolidated Financial Statements in this Form 10-Q
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NPDES
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National Pollutant Discharge Elimination System
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Oliver Wind I
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Oliver Wind I Energy Center
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Oliver Wind II
|
Oliver Wind II Energy Center
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Palm Coast Park District
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Palm Coast Park Community Development District in Florida
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PolyMet
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PolyMet Mining Corp.
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PPA/PSA
|
Power Purchase Agreement / Power Sales Agreement
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PPACA
|
Patient Protection and Affordable Care Act of 2010
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PSCW
|
Public Service Commission of Wisconsin
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SEC
|
Securities and Exchange Commission
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Silver Bay Power
|
Silver Bay Power Company, a wholly-owned subsidiary of Cliffs Natural Resources Inc.
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SIP
|
State Implementation Plan
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SO
2
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Sulfur Dioxide
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Square Butte
|
Square Butte Electric Cooperative, a North Dakota cooperative corporation
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SWL&P
|
Superior Water, Light and Power Company
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Taconite Harbor
|
Taconite Harbor Energy Center
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Tenaska
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Tenaska Energy, Inc. and Tenaska Energy Holdings, LLC
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Thomson
|
Thomson Energy Center
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Town Center District
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Town Center at Palm Coast Community Development District in Florida
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U.S.
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United States of America
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U.S. Water Services
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U.S. Water Services Holding Company and its subsidiaries
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USS Corporation
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United States Steel Corporation
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•
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our ability to successfully implement our strategic objectives;
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•
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global and domestic economic conditions affecting us or our customers;
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•
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changes in and compliance with laws and regulations;
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•
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changes in tax rates or policies or in rates of inflation;
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•
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the outcome of legal and administrative proceedings (whether civil or criminal) and settlements;
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•
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weather conditions, natural disasters and pandemic diseases;
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•
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our ability to access capital markets and bank financing;
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•
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changes in interest rates and the performance of the financial markets;
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•
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project delays or changes in project costs;
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•
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changes in operating expenses and capital expenditures and our ability to raise revenues from our customers in regulated rates or sales price increases at our Energy Infrastructure and Related Services businesses;
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•
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the impacts of commodity prices on ALLETE and our customers;
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•
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our ability to attract and retain qualified, skilled and experienced personnel;
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•
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effects of emerging technology;
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•
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war, acts of terrorism and cyber attacks;
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•
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our ability to manage expansion and integrate acquisitions;
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•
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population growth rates and demographic patterns;
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•
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wholesale power market conditions;
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•
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federal and state regulatory and legislative actions that impact regulated utility economics, including our allowed rates of return, capital structure, ability to secure financing, industry and rate structure, acquisition and disposal of assets and facilities, operation and construction of plant facilities and utility infrastructure, recovery of purchased power, capital investments and other expenses, including present or prospective environmental matters;
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•
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effects of competition, including competition for retail and wholesale customers;
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•
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effects of restructuring initiatives in the electric industry;
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•
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the impacts on our Regulated Operations segment of climate change and future regulation to restrict the emissions of greenhouse gases;
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•
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effects of increased deployment of distributed low-carbon electricity generation resources;
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•
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the impacts of laws and regulations related to renewable and distributed generation;
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•
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pricing, availability and transportation of fuel and other commodities and the ability to recover the costs of such commodities;
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•
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our current and potential industrial and municipal customers’ ability to execute announced expansion plans;
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•
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real estate market conditions where our legacy Florida real estate investment is located may not improve;
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•
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the success of efforts to realize value from, invest in, and develop new opportunities in, our Energy Infrastructure and Related Services businesses; and
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•
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factors affecting our Energy Infrastructure and Related Services businesses, including fluctuations in the volume of customer orders, unanticipated cost increases, changes in legislation and regulations impacting the industries in which the customers served operate, the effects of weather, creditworthiness of customers, ability to obtain materials required to perform services, and changing market conditions.
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June 30,
2017 |
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December 31,
2016 |
||||
Millions
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|
||||
Assets
|
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|
||||
Current Assets
|
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|
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Cash and Cash Equivalents
|
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$84.2
|
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$27.5
|
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Accounts Receivable (Less Allowance of $2.4 and $3.1)
|
120.1
|
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122.5
|
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Inventories – Net
|
103.4
|
|
|
104.2
|
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||
Prepayments and Other
|
38.8
|
|
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40.3
|
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||
Total Current Assets
|
346.5
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294.5
|
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Property, Plant and Equipment – Net
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3,745.6
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3,741.2
|
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Regulatory Assets
|
324.5
|
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330.1
|
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Investment in ATC
|
143.1
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135.6
|
|
||
Other Investments
|
56.2
|
|
|
55.6
|
|
||
Goodwill and Intangible Assets – Net
|
210.8
|
|
|
213.4
|
|
||
Other Non-Current Assets
|
104.8
|
|
|
106.5
|
|
||
Total Assets
|
|
$4,931.5
|
|
|
|
$4,876.9
|
|
Liabilities and Shareholders’ Equity
|
|
|
|
||||
Liabilities
|
|
|
|
||||
Current Liabilities
|
|
|
|
||||
Accounts Payable
|
|
$61.0
|
|
|
|
$74.0
|
|
Accrued Taxes
|
39.1
|
|
|
46.5
|
|
||
Accrued Interest
|
17.5
|
|
|
17.6
|
|
||
Long-Term Debt Due Within One Year
|
117.7
|
|
|
187.7
|
|
||
Other
|
70.1
|
|
|
73.7
|
|
||
Total Current Liabilities
|
305.4
|
|
|
399.5
|
|
||
Long-Term Debt
|
1,401.4
|
|
|
1,370.4
|
|
||
Deferred Income Taxes
|
577.0
|
|
|
554.6
|
|
||
Regulatory Liabilities
|
125.8
|
|
|
125.8
|
|
||
Defined Benefit Pension and Other Postretirement Benefit Plans
|
195.8
|
|
|
210.9
|
|
||
Other Non-Current Liabilities
|
309.1
|
|
|
322.7
|
|
||
Total Liabilities
|
2,914.5
|
|
|
2,983.9
|
|
||
Commitments, Guarantees and Contingencies (Note 13)
|
|
|
|
||||
Shareholders’ Equity
|
|
|
|
||||
Common Stock Without Par Value, 80.0 Shares Authorized, 51.0 and 49.6 Shares Issued and Outstanding
|
1,386.5
|
|
|
1,295.3
|
|
||
Accumulated Other Comprehensive Loss
|
(27.3
|
)
|
|
(28.2
|
)
|
||
Retained Earnings
|
657.8
|
|
|
625.9
|
|
||
Total Shareholders’ Equity
|
2,017.0
|
|
|
1,893.0
|
|
||
Total Liabilities and Shareholders’ Equity
|
|
$4,931.5
|
|
|
|
$4,876.9
|
|
|
Quarter Ended
|
|
Six Months Ended
|
||||||||||
|
June 30,
|
|
June 30,
|
||||||||||
|
2017
|
2016
|
|
2017
|
2016
|
||||||||
Millions Except Per Share Amounts
|
|
|
|
|
|
||||||||
Operating Revenue
|
|
|
|
|
|
||||||||
Utility
|
|
$264.9
|
|
|
$234.9
|
|
|
|
$546.5
|
|
|
$487.2
|
|
Non-utility
|
88.4
|
|
79.9
|
|
|
172.4
|
|
161.4
|
|
||||
Total Operating Revenue
|
353.3
|
|
314.8
|
|
|
718.9
|
|
648.6
|
|
||||
Operating Expenses
|
|
|
|
|
|
||||||||
Fuel, Purchased Power and Gas – Utility
|
93.1
|
|
79.0
|
|
|
189.7
|
|
158.9
|
|
||||
Transmission Services – Utility
|
17.6
|
|
16.1
|
|
|
34.2
|
|
32.9
|
|
||||
Cost of Sales – Non-utility
|
38.4
|
|
32.5
|
|
|
70.0
|
|
62.8
|
|
||||
Operating and Maintenance
|
84.9
|
|
82.0
|
|
|
168.2
|
|
160.1
|
|
||||
Depreciation and Amortization
|
50.1
|
|
48.7
|
|
|
100.6
|
|
96.8
|
|
||||
Taxes Other than Income Taxes
|
14.2
|
|
14.3
|
|
|
28.6
|
|
28.1
|
|
||||
Total Operating Expenses
|
298.3
|
|
272.6
|
|
|
591.3
|
|
539.6
|
|
||||
Operating Income
|
55.0
|
|
42.2
|
|
|
127.6
|
|
109.0
|
|
||||
Other Income (Expense)
|
|
|
|
|
|
||||||||
Interest Expense
|
(16.7
|
)
|
(17.4
|
)
|
|
(33.9
|
)
|
(34.3
|
)
|
||||
Equity Earnings in ATC
|
5.3
|
|
4.1
|
|
|
11.4
|
|
8.9
|
|
||||
Other
|
0.6
|
|
0.6
|
|
|
1.2
|
|
1.6
|
|
||||
Total Other Expense
|
(10.8
|
)
|
(12.7
|
)
|
|
(21.3
|
)
|
(23.8
|
)
|
||||
Income Before Non-Controlling Interest and Income Taxes
|
44.2
|
|
29.5
|
|
|
106.3
|
|
85.2
|
|
||||
Income Tax Expense
|
7.3
|
|
4.7
|
|
|
20.4
|
|
14.0
|
|
||||
Net Income
|
36.9
|
|
24.8
|
|
|
85.9
|
|
71.2
|
|
||||
Less: Non-Controlling Interest in Subsidiaries
|
—
|
|
—
|
|
|
—
|
|
0.5
|
|
||||
Net Income Attributable to ALLETE
|
|
$36.9
|
|
|
$24.8
|
|
|
|
$85.9
|
|
|
$70.7
|
|
Average Shares of Common Stock
|
|
|
|
|
|
||||||||
Basic
|
50.9
|
|
49.3
|
|
|
50.5
|
|
49.2
|
|
||||
Diluted
|
51.1
|
|
49.5
|
|
|
50.7
|
|
49.3
|
|
||||
Basic Earnings Per Share of Common Stock
|
|
$0.73
|
|
|
$0.50
|
|
|
|
$1.70
|
|
|
$1.44
|
|
Diluted Earnings Per Share of Common Stock
|
|
$0.72
|
|
|
$0.50
|
|
|
|
$1.69
|
|
|
$1.43
|
|
Dividends Per Share of Common Stock
|
|
$0.535
|
|
|
$0.52
|
|
|
|
$1.07
|
|
|
$1.04
|
|
|
Quarter Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Millions
|
|
|
|
|
|
|
|
||||||||
Net Income
|
$36.9
|
|
|
$24.8
|
|
|
|
$85.9
|
|
|
|
$71.2
|
|
||
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
||||||||
Currency Translation Adjustments
|
(0.2
|
)
|
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
||||
Unrealized Gain on Securities
|
|
|
|
|
|
|
|
||||||||
Net of Income Tax Expense of $0.2, $0.3, $0.5, and $–
|
0.4
|
|
|
0.4
|
|
|
0.7
|
|
|
—
|
|
||||
Defined Benefit Pension and Other Postretirement Benefit Plans
|
|
|
|
|
|
|
|
||||||||
Net of Income Tax Expense of $0.2, $0.1, $0.3, and $0.2
|
0.2
|
|
|
0.1
|
|
|
0.4
|
|
|
0.3
|
|
||||
Total Other Comprehensive Income
|
0.4
|
|
|
0.5
|
|
|
0.9
|
|
|
0.3
|
|
||||
Total Comprehensive Income
|
37.3
|
|
|
25.3
|
|
|
86.8
|
|
|
71.5
|
|
||||
Less: Non-Controlling Interest in Subsidiaries
|
—
|
|
|
—
|
|
|
—
|
|
|
0.5
|
|
||||
Total Comprehensive Income Attributable to ALLETE
|
|
$37.3
|
|
|
|
$25.3
|
|
|
|
$86.8
|
|
|
|
$71.0
|
|
|
Six Months Ended
|
||||||
|
June 30,
|
||||||
|
2017
|
|
2016
|
||||
Millions
|
|
|
|
||||
Operating Activities
|
|
|
|
||||
Net Income
|
|
$85.9
|
|
|
|
$71.2
|
|
AFUDC – Equity
|
(0.4
|
)
|
|
(1.2
|
)
|
||
Income from Equity Investments – Net of Dividends
|
(2.5
|
)
|
|
(2.9
|
)
|
||
Change in Fair Value of Contingent Consideration
|
(0.4
|
)
|
|
—
|
|
||
Depreciation Expense
|
97.9
|
|
|
94.2
|
|
||
Amortization of PSAs
|
(11.8
|
)
|
|
(11.1
|
)
|
||
Amortization of Other Intangible Assets and Other Assets
|
5.3
|
|
|
5.0
|
|
||
Deferred Income Tax Expense
|
20.2
|
|
|
13.8
|
|
||
Share-Based and ESOP Compensation Expense
|
3.3
|
|
|
2.2
|
|
||
Defined Benefit Pension and Postretirement Benefit Expense
|
5.0
|
|
|
2.6
|
|
||
Bad Debt Expense
|
—
|
|
|
1.1
|
|
||
Changes in Operating Assets and Liabilities
|
|
|
|
||||
Accounts Receivable
|
2.4
|
|
|
6.5
|
|
||
Inventories
|
0.8
|
|
|
6.7
|
|
||
Prepayments and Other
|
4.3
|
|
|
(0.8
|
)
|
||
Accounts Payable
|
(12.6
|
)
|
|
1.3
|
|
||
Other Current Liabilities
|
(12.8
|
)
|
|
(18.5
|
)
|
||
Cash Contributions to Defined Benefit Pension Plans
|
(1.7
|
)
|
|
—
|
|
||
Changes in Regulatory and Other Non-Current Assets
|
6.7
|
|
|
(21.0
|
)
|
||
Changes in Regulatory and Other Non-Current Liabilities
|
(5.2
|
)
|
|
(2.9
|
)
|
||
Cash from Operating Activities
|
184.4
|
|
|
146.2
|
|
||
Investing Activities
|
|
|
|
||||
Proceeds from Sale of Available-for-sale Securities
|
1.0
|
|
|
1.4
|
|
||
Payments for Purchase of Available-for-sale Securities
|
(1.6
|
)
|
|
(1.2
|
)
|
||
Investment in ATC
|
(5.0
|
)
|
|
(1.6
|
)
|
||
Changes to Other Investments
|
1.3
|
|
|
2.1
|
|
||
Additions to Property, Plant and Equipment
|
(81.1
|
)
|
|
(74.8
|
)
|
||
Proceeds from Sale of Property, Plant and Equipment
|
0.7
|
|
|
0.2
|
|
||
Cash for Investing Activities
|
(84.7
|
)
|
|
(73.9
|
)
|
||
Financing Activities
|
|
|
|
||||
Proceeds from Issuance of Common Stock
|
74.4
|
|
|
15.2
|
|
||
Proceeds from Issuance of Long-Term Debt
|
86.2
|
|
|
2.2
|
|
||
Changes in Restricted Cash
|
(1.5
|
)
|
|
(2.0
|
)
|
||
Changes in Notes Payable
|
—
|
|
|
(0.7
|
)
|
||
Repayments of Long-Term Debt
|
(127.0
|
)
|
|
(32.1
|
)
|
||
Acquisition of Non-Controlling Interest
|
—
|
|
|
(8.0
|
)
|
||
Acquisition-Related Contingent Consideration Payments
|
(19.7
|
)
|
|
(0.7
|
)
|
||
Dividends on Common Stock
|
(54.0
|
)
|
|
(51.2
|
)
|
||
Other Financing Activities
|
(1.4
|
)
|
|
(0.1
|
)
|
||
Cash for Financing Activities
|
(43.0
|
)
|
|
(77.4
|
)
|
||
Change in Cash and Cash Equivalents
|
56.7
|
|
|
(5.1
|
)
|
||
Cash and Cash Equivalents at Beginning of Period
|
27.5
|
|
|
97.0
|
|
||
Cash and Cash Equivalents at End of Period
|
|
$84.2
|
|
|
|
$91.9
|
|
|
Total Shareholders’
Equity
|
Retained
Earnings
|
Accumulated
Other
Comprehensive
Loss
|
Common
Stock
|
|||||||
Millions
|
|
|
|
|
|||||||
Balance as of December 31, 2016
|
|
$1,893.0
|
|
|
$625.9
|
|
$(28.2)
|
|
$1,295.3
|
|
|
Comprehensive Income
|
|
|
|
|
|||||||
Net Income
|
85.9
|
|
85.9
|
|
—
|
|
—
|
|
|||
Other Comprehensive Income – Net of Tax
|
|
|
|
|
|||||||
Currency Translation Adjustments
|
(0.2
|
)
|
—
|
|
(0.2
|
)
|
—
|
|
|||
Unrealized Gain on Securities
|
0.7
|
|
—
|
|
0.7
|
|
—
|
|
|||
Defined Benefit Pension and Other Postretirement Plans
|
0.4
|
|
—
|
|
0.4
|
|
—
|
|
|||
Total Comprehensive Income
|
86.8
|
|
|
|
|
||||||
Common Stock Issued
|
91.2
|
|
—
|
|
—
|
|
91.2
|
|
|||
Dividends Declared
|
(54.0
|
)
|
(54.0
|
)
|
—
|
|
—
|
|
|||
Balance as of June 30, 2017
|
|
$2,017.0
|
|
|
$657.8
|
|
$(27.3)
|
|
$1,386.5
|
|
Inventories – Net
|
June 30,
2017 |
|
|
December 31,
2016 |
|
||
Millions
|
|
|
|
||||
Fuel
(a)
|
|
$45.0
|
|
|
|
$43.9
|
|
Materials and Supplies
|
48.0
|
|
|
48.7
|
|
||
Raw Materials
|
2.8
|
|
|
2.9
|
|
||
Work in Progress
|
0.3
|
|
|
1.0
|
|
||
Finished Goods
|
8.3
|
|
|
8.6
|
|
||
Reserve for Obsolescence
|
(1.0
|
)
|
|
(0.9
|
)
|
||
Total Inventories – Net
|
|
$103.4
|
|
|
|
$104.2
|
|
(a)
|
Fuel consists primarily of coal inventory at Minnesota Power.
|
Prepayments and Other Current Assets
|
June 30,
2017 |
|
|
December 31,
2016 |
|
||
Millions
|
|
|
|
||||
Deferred Fuel Adjustment Clause
|
|
$16.7
|
|
|
|
$18.6
|
|
Restricted Cash
|
3.7
|
|
|
2.2
|
|
||
Other
|
18.4
|
|
|
19.5
|
|
||
Total Prepayments and Other Current Assets
|
|
$38.8
|
|
|
|
$40.3
|
|
Other Non-Current Assets
|
June 30,
2017 |
|
|
December 31,
2016 |
|
||
Millions
|
|
|
|
||||
Contract Payment
|
|
$28.4
|
|
|
|
$29.6
|
|
Finance Receivable
|
11.5
|
|
|
11.5
|
|
||
Restricted Cash
|
8.6
|
|
|
8.6
|
|
||
Other
|
56.3
|
|
|
56.8
|
|
||
Total Other Non-Current Assets
|
|
$104.8
|
|
|
|
$106.5
|
|
Other Current Liabilities
|
June 30,
2017 |
|
|
December 31,
2016 |
|
||
Millions
|
|
|
|
||||
PSAs
|
|
$24.7
|
|
|
|
$24.6
|
|
Other
|
45.4
|
|
|
49.1
|
|
||
Total Other Current Liabilities
|
|
$70.1
|
|
|
|
$73.7
|
|
Other Non-Current Liabilities
|
June 30,
2017 |
|
|
December 31,
2016 |
|
||
Millions
|
|
|
|
||||
Asset Retirement Obligation
|
|
$158.2
|
|
|
|
$136.6
|
|
PSAs
|
101.5
|
|
|
113.8
|
|
||
Contingent Consideration
(a)
|
5.5
|
|
|
25.0
|
|
||
Other
|
43.9
|
|
|
47.3
|
|
||
Total Other Non-Current Liabilities
|
|
$309.1
|
|
|
|
$322.7
|
|
(a)
|
Contingent Consideration relates to the estimated fair value of the earnings-based payment resulting from the U.S. Water Services acquisition. (See Note 5. Fair Value.)
|
Six Months Ended June 30,
|
2017
|
|
|
2016
|
|
||
Millions
|
|
|
|
||||
Cash Paid During the Period for Interest – Net of Amounts Capitalized
|
|
$32.5
|
|
|
|
$32.9
|
|
Cash Paid During the Period for Income Taxes
|
|
$0.3
|
|
|
|
$0.4
|
|
Noncash Investing and Financing Activities
|
|
|
|
|
|
||
Decrease in Accounts Payable for Capital Additions to Property, Plant and Equipment
|
$(0.4)
|
|
$(24.4)
|
||||
Capitalized Asset Retirement Costs
|
|
$19.7
|
|
|
|
$2.3
|
|
AFUDC–Equity
|
|
$0.4
|
|
|
|
$1.2
|
|
ALLETE Common Stock Contributed to the Pension Plans
|
|
$13.5
|
|
|
—
|
|
Other Investments
|
June 30,
2017 |
|
|
December 31,
2016 |
|
||
Millions
|
|
|
|
||||
ALLETE Properties
|
|
$29.5
|
|
|
|
$31.7
|
|
Available-for-sale Securities
(a)
|
20.6
|
|
|
18.8
|
|
||
Cash Equivalents
|
2.4
|
|
|
1.3
|
|
||
Other
|
3.7
|
|
|
3.8
|
|
||
Total Other Investments
|
|
$56.2
|
|
|
|
$55.6
|
|
(a)
|
As of
June 30, 2017
, the aggregate amount of available-for-sale corporate and governmental debt securities maturing in one year or less was
$0.6 million
, in one year to less than three years was
$2.7 million
, in three years to less than five years was
$6.8 million
and in five or more years was
$2.9 million
.
|
Millions
|
|
||
Assets Acquired
|
|
||
Cash and Cash Equivalents
|
|
$0.1
|
|
Other Current Assets
|
1.0
|
|
|
Customer Relationships
(a)
|
2.8
|
|
|
Goodwill
(a)(b)
|
4.2
|
|
|
Other Non-Current Assets
|
0.1
|
|
|
Total Assets Acquired
|
|
$8.2
|
|
Liabilities Assumed
|
|
||
Current Liabilities
|
|
$0.3
|
|
Non-Current Liabilities
|
1.2
|
|
|
Total Liabilities Assumed
|
|
$1.5
|
|
Net Identifiable Assets Acquired
|
|
$6.7
|
|
(a)
|
Presented within Goodwill and Intangible Assets – Net on the Consolidated Balance Sheet. (See Note 4. Goodwill and Intangible Assets.)
|
(b)
|
For tax purposes, the purchase price allocation resulted in
no
allocation to goodwill.
|
|
December 31,
2016 |
|
Amortization
|
June 30,
2017 |
|
||
Millions
|
|
|
|
||||
Intangible Assets
|
|
|
|
||||
Definite-Lived Intangible Assets
|
|
|
|
||||
Customer Relationships
|
$59.3
|
$(2.3)
|
|
$57.0
|
|
||
Developed Technology and Other
(a)
|
6.3
|
(0.5)
|
5.8
|
|
|||
Total Definite-Lived Intangible Assets
|
65.6
|
|
(2.8)
|
62.8
|
|
||
Indefinite-Lived Intangible Assets
|
|
|
|
||||
Trademarks and Trade Names
|
16.6
|
|
n/a
|
16.6
|
|
||
Total Intangible Assets
|
|
$82.2
|
|
$(2.8)
|
|
$79.4
|
|
(a)
|
Developed Technology and Other includes patents, non-compete agreements and land easements.
|
|
Fair Value as of June 30, 2017
|
||||||||||||||
Recurring Fair Value Measures
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
||||
Millions
|
|
|
|
|
|
|
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Investments
(a)
|
|
|
|
|
|
|
|
||||||||
Available-for-sale – Equity Securities
|
|
$7.6
|
|
|
—
|
|
|
—
|
|
|
|
$7.6
|
|
||
Available-for-sale – Corporate and Governmental Debt Securities
|
—
|
|
|
|
$13.0
|
|
|
—
|
|
|
13.0
|
|
|||
Cash Equivalents
|
2.4
|
|
|
—
|
|
|
—
|
|
|
2.4
|
|
||||
Total Fair Value of Assets
|
|
$10.0
|
|
|
|
$13.0
|
|
|
—
|
|
|
|
$23.0
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities
(b)
|
|
|
|
|
|
|
|
||||||||
Deferred Compensation
|
—
|
|
|
|
$17.6
|
|
|
—
|
|
|
|
$17.6
|
|
||
U.S. Water Services Contingent Consideration
|
—
|
|
|
—
|
|
|
|
$5.5
|
|
|
5.5
|
|
|||
Total Fair Value of Liabilities
|
—
|
|
|
|
$17.6
|
|
|
|
$5.5
|
|
|
|
$23.1
|
|
|
Total Net Fair Value of Assets (Liabilities)
|
|
$10.0
|
|
|
$(4.6)
|
|
$(5.5)
|
|
$(0.1)
|
(a)
|
Included in Other Investments on the Consolidated Balance Sheet.
|
(b)
|
Included in Other Non-Current Liabilities on the Consolidated Balance Sheet.
|
|
Fair Value as of December 31, 2016
|
||||||||||||||
Recurring Fair Value Measures
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
||||
Millions
|
|
|
|
|
|
|
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Investments
(a)
|
|
|
|
|
|
|
|
||||||||
Available-for-sale – Equity Securities
|
|
$7.1
|
|
|
—
|
|
|
—
|
|
|
|
$7.1
|
|
||
Available-for-sale – Corporate and Governmental Debt Securities
|
—
|
|
|
|
$11.7
|
|
|
—
|
|
|
11.7
|
|
|||
Cash Equivalents
|
1.3
|
|
|
—
|
|
|
—
|
|
|
1.3
|
|
||||
Total Fair Value of Assets
|
|
$8.4
|
|
|
|
$11.7
|
|
|
—
|
|
|
|
$20.1
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities
(b)
|
|
|
|
|
|
|
|
||||||||
Deferred Compensation
|
—
|
|
|
|
$16.0
|
|
|
—
|
|
|
|
$16.0
|
|
||
U.S. Water Services Contingent Consideration
|
—
|
|
|
—
|
|
|
|
$25.0
|
|
|
25.0
|
|
|||
Total Fair Value of Liabilities
|
—
|
|
|
|
$16.0
|
|
|
|
$25.0
|
|
|
|
$41.0
|
|
|
Total Net Fair Value of Assets (Liabilities)
|
|
$8.4
|
|
|
$(4.3)
|
|
$(25.0)
|
|
$(20.9)
|
(a)
|
Included in Other Investments on the Consolidated Balance Sheet.
|
(b)
|
Included in Other Non-Current Liabilities on the Consolidated Balance Sheet.
|
Recurring Fair Value Measures
|
|
||
Activity in Level 3
|
|
||
Millions
|
|
||
Balance as of December 31, 2016
|
|
$25.0
|
|
Accretion
|
0.6
|
|
|
Payments
(a)
|
(19.7
|
)
|
|
Changes in Cash Flow Projections
(a)
|
(0.4
|
)
|
|
Balance as of June 30, 2017
|
|
$5.5
|
|
(a)
|
Payments and changes in cash flow projections reflect the impact of a modification to the shareholder agreement in the first quarter of 2017 which provided participants a one-time election to sell shares at a determined price. Participants representing approximately half of the outstanding contingent consideration shares made the election, which were paid in the first six months of 2017.
|
Financial Instruments
|
Carrying Amount
|
|
Fair Value
|
Millions
|
|
|
|
Long-Term Debt, Including Long-Term Debt Due Within One Year
|
|
|
|
June 30, 2017
|
$1,529.6
|
|
$1,634.6
|
December 31, 2016
|
$1,569.1
|
|
$1,653.8
|
Regulatory Assets and Liabilities
|
June 30,
2017 |
|
|
December 31,
2016 |
|
||
Millions
|
|
|
|
||||
Current Regulatory Assets
|
|
|
|
||||
Deferred Fuel Adjustment Clause
|
|
$16.7
|
|
|
|
$18.6
|
|
Total Current Regulatory Assets
|
16.7
|
|
|
18.6
|
|
||
Non-Current Regulatory Assets
|
|
|
|
||||
Defined Benefit Pension and Other Postretirement Benefit Plans
|
223.4
|
|
|
226.1
|
|
||
Income Taxes
(a)
|
35.0
|
|
|
33.8
|
|
||
Asset Retirement Obligations
|
28.4
|
|
|
26.0
|
|
||
Cost Recovery Riders
|
13.8
|
|
|
30.5
|
|
||
Conservation Improvement Program
|
7.1
|
|
|
4.0
|
|
||
PPACA Income Tax Deferral
|
5.0
|
|
|
5.0
|
|
||
Other
|
11.8
|
|
|
4.7
|
|
||
Total Non-Current Regulatory Assets
|
324.5
|
|
|
330.1
|
|
||
Total Regulatory Assets
|
|
$341.2
|
|
|
|
$348.7
|
|
|
|
|
|
||||
Non-Current Regulatory Liabilities
|
|
|
|
||||
Wholesale and Retail Contra AFUDC
|
|
$56.9
|
|
|
|
$56.8
|
|
North Dakota Investment Tax Credits
|
27.7
|
|
|
28.2
|
|
||
Plant Removal Obligations
|
19.0
|
|
|
19.1
|
|
||
Income Taxes
|
18.8
|
|
|
19.1
|
|
||
Other
|
3.4
|
|
|
2.6
|
|
||
Total Non-Current Regulatory Liabilities
|
|
$125.8
|
|
|
|
$125.8
|
|
(a)
|
See Note 1. Operations and Significant Accounting Policies – Revision of Prior Balance Sheet.
|
ALLETE’s Investment in ATC
|
|
||
Millions
|
|
||
Equity Investment Balance as of December 31, 2016
|
|
$135.6
|
|
Cash Investments
|
5.0
|
|
|
Equity in ATC Earnings
|
11.4
|
|
|
Distributed ATC Earnings
|
(8.9
|
)
|
|
Equity Investment Balance as of June 30, 2017
|
|
$143.1
|
|
June 30, 2017
|
Principal
|
|
|
Unamortized Debt Issuance Costs
|
|
Total
|
|
||
Millions
|
|
|
|
|
|
||||
Short-Term Debt
|
|
$118.2
|
|
|
$(0.5)
|
|
|
$117.7
|
|
Long-Term Debt
|
1,411.4
|
|
|
(10.0)
|
|
1,401.4
|
|
||
Total Debt
|
|
$1,529.6
|
|
|
$(10.5)
|
|
|
$1,519.1
|
|
December 31, 2016
|
Principal
|
|
|
Unamortized Debt Issuance Costs
|
|
Total
|
|
||
Millions
|
|
|
|
|
|
||||
Short-Term Debt
|
|
$188.3
|
|
|
$(0.6)
|
|
|
$187.7
|
|
Long-Term Debt
|
1,380.8
|
|
|
(10.4)
|
|
1,370.4
|
|
||
Total Debt
|
|
$1,569.1
|
|
|
$(11.0)
|
|
|
$1,558.1
|
|
|
|
Quarter Ended
|
|
Six Months Ended
|
|||||||||||
|
|
June 30,
|
|
June 30,
|
|||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|||||||
Millions
|
|
|
|
|
|
|
|
|
|||||||
Current Tax Expense
(a)
|
|
|
|
|
|
|
|
|
|||||||
Federal
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
State
|
|
$0.1
|
|
$0.1
|
|
|
$0.2
|
|
|
$0.2
|
|||||
Total Current Tax Expense
|
|
$0.1
|
|
$0.1
|
|
|
$0.2
|
|
|
$0.2
|
|||||
Deferred Tax Expense
|
|
|
|
|
|
|
|
|
|||||||
Federal
|
|
$3.8
|
|
|
$2.1
|
|
|
$11.1
|
|
|
$6.7
|
|
|||
State
|
|
3.6
|
|
|
2.7
|
|
|
9.5
|
|
|
7.5
|
|
|||
Investment Tax Credit Amortization
|
|
(0.2
|
)
|
|
(0.2
|
)
|
|
(0.4
|
)
|
|
(0.4
|
)
|
|||
Total Deferred Tax Expense
|
|
$7.2
|
|
|
$4.6
|
|
|
$20.2
|
|
|
$13.8
|
|
|||
Total Income Tax Expense
|
|
$7.3
|
|
|
$4.7
|
|
|
$20.4
|
|
|
$14.0
|
|
(a)
|
For the quarter and
six months ended June 30, 2017, and 2016
, the federal and state current tax expense was minimal due to NOLs which resulted from the bonus depreciation provisions of the Protecting Americans from Tax Hikes Act of 2015, the Tax Increase Prevention Act of 2014 and the American Taxpayer Relief Act of 2012.
|
|
Quarter Ended
|
Six Months Ended
|
||||||||||||
Reconciliation of Taxes from Federal Statutory
|
June 30,
|
June 30,
|
||||||||||||
Rate to Total Income Tax Expense
|
2017
|
|
2016
|
2017
|
|
2016
|
||||||||
Millions
|
|
|
|
|
|
|
||||||||
Income Before Non-Controlling Interest and Income Taxes
|
|
$44.2
|
|
|
|
$29.5
|
|
|
$106.3
|
|
|
|
$85.2
|
|
Statutory Federal Income Tax Rate
|
35
|
%
|
|
35
|
%
|
35
|
%
|
|
35
|
%
|
||||
Income Taxes Computed at 35 percent Statutory Federal Rate
|
|
$15.5
|
|
|
|
$10.3
|
|
|
$37.2
|
|
|
|
$29.8
|
|
Increase (Decrease) in Tax Due to:
|
|
|
|
|
|
|
||||||||
State Income Taxes – Net of Federal Income Tax Benefit
|
2.4
|
|
|
1.8
|
|
6.3
|
|
|
5.0
|
|
||||
Production Tax Credits
|
(10.0
|
)
|
|
(6.6
|
)
|
(23.0
|
)
|
|
(20.5
|
)
|
||||
Other
|
(0.6
|
)
|
|
(0.8
|
)
|
(0.1
|
)
|
|
(0.3
|
)
|
||||
Total Income Tax Expense
|
|
$7.3
|
|
|
|
$4.7
|
|
|
$20.4
|
|
|
|
$14.0
|
|
|
|
|
2017
|
|
|
|
|
|
2016
|
|
|
||||||||||
Reconciliation of Basic and Diluted
|
|
|
Dilutive
|
|
|
|
|
|
Dilutive
|
|
|
||||||||||
Earnings Per Share
|
Basic
|
|
Securities
|
|
Diluted
|
|
Basic
|
|
Securities
|
|
Diluted
|
||||||||||
Millions Except Per Share Amounts
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Quarter ended June 30,
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Income Attributable to ALLETE
|
|
$36.9
|
|
|
|
|
|
$36.9
|
|
|
|
$24.8
|
|
|
|
|
|
$24.8
|
|
||
Average Common Shares
|
50.9
|
|
|
0.2
|
|
|
51.1
|
|
|
49.3
|
|
|
0.2
|
|
|
49.5
|
|
||||
Earnings Per Share
|
|
$0.73
|
|
|
|
|
|
$0.72
|
|
|
|
$0.50
|
|
|
|
|
|
$0.50
|
|
||
Six Months Ended June 30,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net Income Attributable to ALLETE
|
|
$85.9
|
|
|
|
|
|
$85.9
|
|
|
|
$70.7
|
|
|
|
|
|
$70.7
|
|
||
Average Common Shares
|
50.5
|
|
|
0.2
|
|
|
50.7
|
|
|
49.2
|
|
|
0.1
|
|
|
49.3
|
|
||||
Earnings Per Share
|
|
$1.70
|
|
|
|
|
|
$1.69
|
|
|
|
$1.44
|
|
|
|
|
|
$1.43
|
|
|
Pension
|
|
Other
Postretirement
|
||||||||||||
Components of Net Periodic Benefit Cost (Income)
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Millions
|
|
|
|
|
|
|
|
||||||||
Quarter Ended June 30,
|
|
|
|
|
|
|
|
||||||||
Service Cost
|
|
$2.6
|
|
|
|
$2.1
|
|
|
|
$1.1
|
|
|
|
$1.0
|
|
Interest Cost
|
8.2
|
|
|
8.1
|
|
|
1.9
|
|
|
1.8
|
|
||||
Expected Return on Plan Assets
|
(10.6
|
)
|
|
(10.7
|
)
|
|
(2.7
|
)
|
|
(2.8
|
)
|
||||
Amortization of Prior Service Credits
|
—
|
|
|
—
|
|
|
(0.5
|
)
|
|
(0.8
|
)
|
||||
Amortization of Net Loss
|
2.4
|
|
|
2.5
|
|
|
0.1
|
|
|
0.1
|
|
||||
Net Periodic Benefit Cost (Income)
|
|
$2.6
|
|
|
|
$2.0
|
|
|
$(0.1)
|
|
$(0.7)
|
||||
|
|
|
|
|
|
|
|
||||||||
Six Months Ended June 30,
|
|
|
|
|
|
|
|
||||||||
Service Cost
|
|
$5.1
|
|
|
|
$4.1
|
|
|
|
$2.2
|
|
|
|
$2.0
|
|
Interest Cost
|
16.3
|
|
|
16.2
|
|
|
3.8
|
|
|
3.7
|
|
||||
Expected Return on Plan Assets
|
(21.2
|
)
|
|
(21.3
|
)
|
|
(5.3
|
)
|
|
(5.6
|
)
|
||||
Amortization of Prior Service Credits
|
—
|
|
|
—
|
|
|
(1.0
|
)
|
|
(1.5
|
)
|
||||
Amortization of Net Loss
|
4.9
|
|
|
4.9
|
|
|
0.2
|
|
|
0.1
|
|
||||
Net Periodic Benefit Cost (Income)
|
|
$5.1
|
|
|
|
$3.9
|
|
|
$(0.1)
|
|
$(1.3)
|
•
|
Expanding our renewable energy supply;
|
•
|
Providing energy conservation initiatives for our customers and engaging in other demand side efforts;
|
•
|
Improving efficiency of our generating facilities;
|
•
|
Supporting research of technologies to reduce carbon emissions from generating facilities and carbon sequestration efforts; and
|
•
|
Evaluating and developing less carbon intensive future generating assets such as efficient and flexible natural gas-fired generating facilities.
|
|
Quarter Ended
|
|
Six Months Ended
|
||||||||||
|
June 30,
|
|
June 30,
|
||||||||||
|
2017
|
2016
|
|
2017
|
2016
|
||||||||
Millions
|
|
|
|
|
|
||||||||
Operating Revenue
|
|
|
|
|
|
||||||||
Regulated Operations
|
$264.9
|
$234.9
|
|
$546.5
|
$487.2
|
||||||||
|
|
|
|
|
|
||||||||
Energy Infrastructure and Related Services
|
|
|
|
|
|
||||||||
ALLETE Clean Energy
|
19.6
|
|
18.8
|
|
|
43.3
|
|
42.4
|
|
||||
U.S. Water Services
|
38.4
|
|
34.3
|
|
|
70.5
|
|
66.7
|
|
||||
|
|
|
|
|
|
||||||||
Corporate and Other
|
30.4
|
|
26.8
|
|
|
58.6
|
|
52.3
|
|
||||
Total Operating Revenue
|
|
$353.3
|
|
|
$314.8
|
|
|
|
$718.9
|
|
|
$648.6
|
|
Net Income (Loss) Attributable to ALLETE
|
|
|
|
|
|
||||||||
Regulated Operations
|
|
$32.4
|
|
|
$22.6
|
|
|
|
$75.9
|
|
|
$65.0
|
|
|
|
|
|
|
|
||||||||
Energy Infrastructure and Related Services
|
|
|
|
|
|
||||||||
ALLETE Clean Energy
|
3.8
|
|
2.6
|
|
|
10.5
|
|
8.7
|
|
||||
U.S. Water Services
|
0.6
|
|
1.0
|
|
|
0.3
|
|
0.5
|
|
||||
|
|
|
|
|
|
||||||||
Corporate and Other
|
0.1
|
|
(1.4
|
)
|
|
(0.8
|
)
|
(3.5
|
)
|
||||
Total Net Income Attributable to ALLETE
|
|
$36.9
|
|
|
$24.8
|
|
|
|
$85.9
|
|
|
$70.7
|
|
|
June 30,
2017 |
|
December 31,
2016 |
|
||
Millions
|
|
|
||||
Assets
|
|
|
||||
Regulated Operations
|
$3,824.8
|
$3,823.9
|
||||
|
|
|
||||
Energy Infrastructure and Related Services
|
|
|
||||
ALLETE Clean Energy
|
559.1
|
|
566.0
|
|
||
U.S. Water Services
|
267.0
|
|
264.1
|
|
||
|
|
|
||||
Corporate and Other
|
280.6
|
|
222.9
|
|
||
Total Assets
|
|
$4,931.5
|
|
|
$4,876.9
|
|
Quarter Ended June 30,
|
2017
|
|
2016
|
|
||
Millions
|
|
|
||||
Operating Revenue – Utility
|
|
$264.9
|
|
|
$234.9
|
|
Fuel, Purchased Power and Gas – Utility
|
93.1
|
|
79.0
|
|
||
Transmission Services – Utility
|
17.6
|
|
16.1
|
|
||
Operating and Maintenance
|
56.3
|
|
53.5
|
|
||
Depreciation and Amortization
|
39.0
|
|
38.3
|
|
||
Taxes Other than Income Taxes
|
12.7
|
|
12.8
|
|
||
Operating Income
|
46.2
|
|
35.2
|
|
||
Interest Expense
|
(14.5
|
)
|
(12.7
|
)
|
||
Equity Earnings in ATC
|
5.3
|
|
4.1
|
|
||
Other Income
|
0.2
|
|
0.3
|
|
||
Income Before Income Taxes
|
37.2
|
|
26.9
|
|
||
Income Tax Expense
|
4.8
|
|
4.3
|
|
||
Net Income Attributable to ALLETE
|
$32.4
|
|
$22.6
|
|
Quarter Ended June 30,
|
2017
|
|
2016
|
|
||
Millions
|
|
|
||||
Operating Revenue
|
|
$19.6
|
|
|
$18.8
|
|
Net Income Attributable to ALLETE
|
$3.8
|
|
$2.6
|
|
|
Quarter Ended June 30,
|
|||||||||
|
2017
|
2016
|
||||||||
Production and Operating Revenue
|
kWh
|
Revenue
|
kWh
|
Revenue
|
||||||
Millions
|
|
|
|
|
||||||
Wind Energy Facilities
|
|
|
|
|
||||||
Lake Benton
|
58.4
|
|
|
$3.1
|
|
63.5
|
|
|
$3.1
|
|
Storm Lake II
|
35.0
|
|
2.3
|
|
39.1
|
|
2.6
|
|
||
Condon
|
20.6
|
|
1.7
|
|
22.5
|
|
1.9
|
|
||
Storm Lake I
|
49.4
|
|
3.0
|
|
56.3
|
|
2.9
|
|
||
Chanarambie/Viking
|
64.6
|
|
3.5
|
|
64.5
|
|
3.2
|
|
||
Armenia Mountain
|
62.5
|
|
6.0
|
|
48.8
|
|
5.1
|
|
||
Total Production and Operating Revenue
|
290.5
|
|
$19.6
|
294.7
|
|
|
$18.8
|
|
Quarter Ended June 30,
|
2017
|
|
2016
|
|
||
Millions
|
|
|
||||
Operating Revenue
|
|
$38.4
|
|
|
$34.3
|
|
Net Income Attributable to ALLETE
|
$0.6
|
$1.0
|
Six Months Ended June 30,
|
2017
|
|
2016
|
|
||
Millions
|
|
|
||||
Operating Revenue – Utility
|
|
$546.5
|
|
|
$487.2
|
|
Fuel, Purchased Power and Gas – Utility
|
189.7
|
|
158.9
|
|
||
Transmission Services – Utility
|
34.2
|
|
32.9
|
|
||
Operating and Maintenance
|
111.3
|
|
104.1
|
|
||
Depreciation and Amortization
|
78.7
|
|
76.6
|
|
||
Taxes Other than Income Taxes
|
25.9
|
|
25.0
|
|
||
Operating Income
|
106.7
|
|
89.7
|
|
||
Interest Expense
|
(28.5
|
)
|
(25.8
|
)
|
||
Equity Earnings in ATC
|
11.4
|
|
8.9
|
|
||
Other Income
|
0.4
|
|
1.2
|
|
||
Income Before Income Taxes
|
90.0
|
|
74.0
|
|
||
Income Tax Expense
|
14.1
|
|
9.0
|
|
||
Net Income Attributable to ALLETE
|
$75.9
|
|
$65.0
|
|
Six Months Ended June 30,
|
2017
|
|
2016
|
|
||
Millions
|
|
|
||||
Operating Revenue
|
|
$43.3
|
|
|
$42.4
|
|
Net Income Attributable to ALLETE
|
$10.5
|
|
$8.7
|
|
|
Six Months Ended June 30,
|
|||||||||
|
2017
|
2016
|
||||||||
Production and Operating Revenue
|
kWh
|
Revenue
|
kWh
|
Revenue
|
||||||
Millions
|
|
|
|
|
||||||
Wind Energy Facilities
|
|
|
|
|
||||||
Lake Benton
|
134.2
|
|
|
$6.6
|
|
133.5
|
|
|
$6.5
|
|
Storm Lake II
|
83.2
|
|
5.2
|
|
91.6
|
|
5.6
|
|
||
Condon
|
44.8
|
|
3.7
|
|
51.0
|
|
4.3
|
|
||
Storm Lake I
|
119.1
|
|
6.4
|
|
120.3
|
|
6.0
|
|
||
Chanarambie/Viking
|
145.5
|
|
7.4
|
|
145.1
|
|
6.8
|
|
||
Armenia Mountain
|
150.2
|
|
14.0
|
|
140.8
|
|
13.2
|
|
||
Total Production and Operating Revenue
|
677.0
|
|
$43.3
|
682.3
|
|
|
$42.4
|
|
Six Months Ended June 30,
|
2017
|
|
2016
|
|
||
Millions
|
|
|
||||
Operating Revenue
|
|
$70.5
|
|
|
$66.7
|
|
Net Income Attributable to ALLETE
|
$0.3
|
$0.5
|
Wind Energy Facility
|
Location
|
Capacity MW
|
PSA MW %
|
PSA Expiration
|
Armenia Mountain
|
Pennsylvania
|
100.5
|
100%
|
2024
|
Chanarambie/Viking
|
Minnesota
|
97.5
|
|
|
PSA 1
|
|
|
12%
|
2018
|
PSA 2
|
|
|
88%
|
2023
|
Condon
|
Oregon
|
50
|
100%
|
2022
|
Lake Benton
|
Minnesota
|
104
|
100%
|
2028
|
Storm Lake I
|
Iowa
|
108
|
100%
|
2019
|
Storm Lake II
|
Iowa
|
77
|
|
|
PSA 1
|
|
|
90%
|
2019
|
PSA 2
|
|
|
10%
|
2032
|
|
June 30,
2017 |
|
|
%
|
|
December 31,
2016 |
|
|
%
|
||
Millions
|
|
|
|
|
|
|
|
||||
Shareholders’ Equity
|
|
$2,017.0
|
|
|
57
|
|
|
$1,893.0
|
|
|
55
|
Long-Term Debt (Including Long-Term Debt Due Within One Year)
|
1,529.6
|
|
|
43
|
|
1,569.1
|
|
|
45
|
||
|
|
$3,546.6
|
|
|
100
|
|
|
$3,462.1
|
|
|
100
|
For the Six Months Ended June 30,
|
2017
|
|
|
2016
|
|
||
Millions
|
|
|
|
||||
Cash and Cash Equivalents at Beginning of Period
|
|
$27.5
|
|
|
|
$97.0
|
|
Cash Flows from (used for)
|
|
|
|
||||
Operating Activities
|
184.4
|
|
|
146.2
|
|
||
Investing Activities
|
(84.7
|
)
|
|
(73.9
|
)
|
||
Financing Activities
|
(43.0
|
)
|
|
(77.4
|
)
|
||
Change in Cash and Cash Equivalents
|
56.7
|
|
|
(5.1
|
)
|
||
Cash and Cash Equivalents at End of Period
|
|
$84.2
|
|
|
|
$91.9
|
|
Credit Ratings
|
Standard & Poor’s
|
Moody’s
|
Issuer Credit Rating
|
BBB+
|
A3
|
Commercial Paper
|
A-2
|
P-2
|
First Mortgage Bonds
|
(a)
|
A1
|
(a)
|
Not rated by Standard & Poor’s.
|
Exhibit
Number
|
|
|
31(a)
|
|
Rule 13a-14(a)/15d-14(a) Certification by the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
31(b)
|
|
Rule 13a-14(a)/15d-14(a) Certification by the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
32
|
|
Section 1350 Certification of Periodic Report by the Chief Executive Officer and the Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
95
|
|
Mine Safety
|
99
|
|
ALLETE News Release dated August 2, 2017, announcing 2017 second quarter earnings.
(This exhibit has been furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.)
|
101.INS
|
|
XBRL Instance
|
101.SCH
|
|
XBRL Schema
|
101.CAL
|
|
XBRL Calculation
|
101.DEF
|
|
XBRL Definition
|
101.LAB
|
|
XBRL Label
|
101.PRE
|
|
XBRL Presentation
|
|
|
ALLETE, INC.
|
|
|
|
|
|
|
|
|
|
|
|
|
August 2, 2017
|
|
/s/ Robert J. Adams
|
|
|
Robert J. Adams
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
(Principal Financial Officer)
|
|
|
|
|
|
|
|
|
|
|
|
|
August 2, 2017
|
|
/s/ Steven W. Morris
|
|
|
Steven W. Morris
|
|
|
Vice President, Controller and Chief Accounting Officer
|
|
|
(Principal Accounting Officer)
|
1 Year Allete Chart |
1 Month Allete Chart |
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