ALLETE (ALE) investor relations material

Executive summary

• Second quarter 2025 net income was $31.9 million ($0.55 per share), down from $33.0 million ($0.57 per share) in Q2 2024, with results impacted by lower industrial margins, higher expenses, and merger-related costs.

• Merger-related expenses were $3.4 million after-tax in Q2 2025, compared to $14.5 million in Q2 2024; the proposed merger is expected to close in 2025, pending regulatory approval.

• Settlement agreement reached with the Minnesota Department of Commerce and transaction partners to support the merger, with regulatory approval pending.

• Superior Water, Light and Power secured legislative changes to access federal grants for lead service line replacement, benefiting customers.

Financial highlights

• Q2 2025 operating revenue was $360.3 million, up from $354.5 million in Q2 2024; six-month revenue was $760.5 million, up from $757.8 million year-over-year.

• Net income attributable to shareholders for the first half of 2025 was $88.0 million ($1.52 per share), up from $83.7 million ($1.45 per share) in 2024.

• Q2 2025 operating income was $18.0 million, down from $29.4 million in Q2 2024.

• Dividend per share increased to $0.73 in Q2 2025 from $0.705 in Q2 2024.

• Book value per share at quarter end was $49.31, up from $48.86 a year earlier.

Outlook and guidance

• The company targets long-term EPS growth of 5–7% and expects Regulated Operations to contribute about 75% of 2025 net income.

• Transaction costs from the merger are expected to be material in 2025.

• Industrial sales, especially to taconite customers, are projected to remain lower for the remainder of 2025.

• Capital expenditures for 2025 are expected to be approximately $900 million, mainly for Minnesota Power solar and transmission projects.