Hydro-Québec announces its results for the first half of 2007



    MONTREAL, Aug. 20 /CNW Telbec/ - For the six months ended June 30, 2007,
Hydro-Québec posted income from continuing operations of $2,045 million, up
$330 million from the same period last year.
    "This increase is mainly due to growth in net electricity exports by
Hydro-Québec Production, which accounted for $362 million, and to colder
temperatures in 2007 than in 2006," said Daniel Garant, Executive Vice
President - Finance and Chief Financial Officer at Hydro-Québec.
    These factors were mitigated by the recognition of a non-recurring
foreign exchange gain in second quarter 2006 and by the introduction, in
January 2007, of water-power royalties payable by Hydro-Québec Production.
    Income from discontinued operations was $21 million, compared to
$856 million in 2006. The 2007 income resulted primarily from an $18-million
gain on the sale of DirectLink (Australia) in the first quarter. The sale of
Transelec (Chile) had generated most of the income recorded a year earlier.
    For the six months ended June 30, 2007, net income totaled
$2,066 million, as against $2,571 million in 2006.

    Second quarter results

    Income from continuing operations for second quarter 2007 reached
$635 million, up $25 million from 2006. This result is mainly attributable to
a $228-million increase in Hydro-Québec Production's net electricity exports
in 2007, offset by the $234-million non-recurring exchange gain recognized in
2006.

    Segmented results

    Hydro-Québec Production's net income amounted to $1,410 million for the
first half of 2007, up $68 million from last year, primarily due to an
increase in net electricity exports that was largely offset by the recognition
of the $234-million non-recurring foreign exchange gain in second quarter
2006.
    Hydro-Québec TransEnergie posted net income of $277 million, a decrease
of $150 million from last year. The difference stems from the fact that
non-recurring native load transmission revenue of $170 million for 2005 had
been recognized in revenue for second quarter 2006, following a decision
handed down by the Régie de l'énergie in April 2006.
    Hydro-Québec Distribution recorded net income of $372 million, versus a
$48-million loss in the first six months of 2006. This increase is mainly due
to higher revenue from electricity sales, mitigated by a higher volume of
electricity purchases in excess of the heritage pool. Sales volume was
90.1 TWh, an increase of 3.1 TWh compared to 2006.
    Moreover, the recognition in 2006 of non-recurring native load
transmission costs for 2005 has resulted in a positive variance of
$170 million in net income for the first half of 2007.
    For the first six months, the volume of activity of Hydro-Québec
Equipement and Société d'énergie de la Baie James totaled $823 million,
compared to $838 million in 2006. Work continued on the
Eastmain-1-A/Sarcelle/Rupert project, which got under way in the first
quarter.
    As at June 30, 2007, investments reached $1,495 million, compared to
$1,468 million in 2006. A large portion of this amount was devoted to the
development projects of Hydro-Québec Production, such as the
Eastmain-1-A/Sarcelle/Rupert project and the Péribonka, Chute-Allard and
Rapides-des-Coeurs hydroelectric developments.
    The 2007 borrowing program amounts to $1.1 billion. A single,
$526-million borrowing has been made since the beginning of the year. It was
contracted on the Canadian market at a cost of 4.73%.

    To access Hydro-Québec's Second quarter results, click <a href="http://www.hydroquebec.com/publications/en/quarterly_report/2007/second_quart.html">here</a>.

    To access the presentation, click <a href="http://diffusion.pecunia.ca/hydro_200708/">here</a> (in French).




For further information:

For further information: Hydro-Québec - Media and Emergency
Communication Team: Josée Morin, Press Officer, (514) 289-4214,
morin.josee@hydro.qc.ca; Press room: http://www.hydroquebec.com/media


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