Enbridge Inc.
TSX : ENB
NYSE : ENB

Enbridge Inc.

May 07, 2008 07:00 ET

Enbridge Reports Solid Start to 2008

Highlights - First quarter earnings increased $24 million, or 11%, to $251 million - First quarter adjusted operating earnings increased $10 million, or 4%, to $239 million - Alberta Clipper, Southern Lights Pipeline and Line 4 Extension were approved by the NEB - First phase of the U.S. Southern Access Expansion Project has been completed - Enbridge-led carbon sequestration project secured provincial government funding - Rabaska LNG Project was approved by the Canadian federal government

CALGARY, ALBERTA--(Marketwire - May 7, 2008) - Enbridge Inc. (TSX:ENB) (NYSE:ENB) - "Favourable results for the first quarter of 2008 demonstrate the inherent strength and reliability of our existing core businesses and leave us well positioned to achieve our previously announced full year adjusted operating earnings target of $1.80 to $1.90 per common share," said Patrick D. Daniel, President and Chief Executive Officer.

"While growing the base business, we are actively developing our large project inventory which is now well into the construction phase with projects scheduled to be completed throughout the four year period from 2008 to 2011. The first phase of the Southern Access Expansion Project, which adds about 190,000 barrels per day of capacity to our mainline system, has been completed and was ready to receive linefill on schedule at the end of the first quarter of 2008. The Waupisoo Pipeline, linking the Alberta oil sands to the Edmonton, Alberta area, is expected to come into service by the end of the second quarter of 2008, or earlier.

During the first quarter of 2008, we advanced other key pipeline projects and secured NEB approval for Alberta Clipper Pipeline, Southern Lights Pipeline and the Line 4 Extension Project.

Beyond 2008, we expect Enbridge to deliver solid, visible and more rapid growth," Mr. Daniel concluded. "We expect the completion of major projects currently under construction will add meaningfully to earnings and cash flows as they come into service between now and 2011. This will accelerate our earnings growth to an annual average rate of 10% over the next four years."

On May 6, 2008, the Enbridge Board of Directors declared quarterly dividends of $0.33 per common share and $0.34375 per Series A Preferred Share. Both dividends are payable on June 1, 2008 to shareholders of record on May 15, 2008.

Forward Looking Information

This news release contains forward looking information. Significant related assumptions and risk factors are described under the Forward Looking Information section of this news release.



Consolidated Earnings
----------------------------------------------------------------------------
Three months ended
March 31,
----------------------
(millions of Canadian dollars) 2008 2007
----------------------------------------------------------------------------

Liquids Pipelines 76.1 68.9
Gas Pipelines 18.2 25.7
Sponsored Investments 31.1 17.8
Gas Distribution and Services 153.8 109.1
International 16.3 22.0
Corporate (44.2) (16.5)
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Earnings Applicable to Common Shareholders 251.3 227.0
----------------------------------------------------------------------------
----------------------------------------------------------------------------


Earnings applicable to common shareholders were $251.3 million for the three months ended March 31, 2008, or $0.70 per share, compared with $227.0 million, or $0.65 per share, for the three months ended March 31, 2007. The $24.3 million increase in earnings reflected a higher contribution from Enbridge Gas Distribution (EGD) as weather in its franchise area was significantly colder than normal, as well as improved results in Aux Sable and Energy Services. This increase was partially offset by the recognition of a $32.2 million income tax charge as a result of an unfavourable court decision related to previously owned U.S. pipeline assets.



Adjusted Operating Earnings
----------------------------------------------------------------------------
Three months ended
March 31,
----------------------
(millions of Canadian dollars, except per share
amounts) 2008 2007
----------------------------------------------------------------------------

GAAP earnings as reported 251.3 227.0
Significant after tax non-operating factors and
variances:
Gas Pipelines
Shipper claim settlement (2.8) -
Offshore property insurance recovery from 2005
hurricanes - (5.3)
Sponsored Investments
Dilution gain on EEP Class A unit issuance (4.5) -
EEP unrealized derivative fair value (gains)/losses (1.3) 2.0
Shipper claim settlement (1.3) -
Gas Distribution and Services
Colder than normal weather affecting EGD (13.7) (1.4)
Energy Services unrealized derivative fair value
losses - 4.3
Aux Sable unrealized derivative fair value
(gains)/losses (18.9) 2.8
International
CLH unrealized derivative fair value losses 2.8 -
Corporate
Gain on sale of corporate aircraft (4.9) -
U.S. pipeline tax decision 32.2 -
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Adjusted Operating Earnings 238.9 229.4
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Adjusted Operating Earnings per Common Share 0.67 0.65
----------------------------------------------------------------------------
----------------------------------------------------------------------------


Adjusted operating earnings were $238.9 million, or $0.67 per share, for the three months ended March 31, 2008, compared with $229.4 million, or $0.65 per share, for the three months ended March 31, 2007.

The increase in adjusted operating earnings was largely due to:

- Allowance for equity funds used during construction (AEDC) on Southern Lights Pipeline and within Enbridge System;

- Improved earnings in Energy Services resulting from market conditions which enabled higher margins to be captured on storage and transportation contracts as well as increased transportation and storage volumes; and

- Record performance from Enbridge Energy Partners (EEP).

These increases were partially offset by the impact of a weaker U.S. dollar on U.S.-based operations.

While under construction, certain regulated pipelines are entitled to recognize AEDC in earnings. These amounts will contribute to earnings throughout the Company's significant growth period and will be collected in tolls once the pipelines are in service.

The Company has foreign currency denominated earnings, primarily from U.S. based operations and investments, as well as its euro investment in Compania Logistica de Hidrocarburos CLH, S.A. (CLH). The Company uses long-term derivative contracts to economically hedge a significant portion of the cash distributions from these long-term investments. However, this does not eliminate the Canadian generally accepted accounting principles (GAAP) earnings volatility caused by exchange rate differences. During the three months ended March 31, 2008, the Company received foreign currency denominated cash distributions and settled associated hedge transactions resulting in $4.7 million (2007 - $3.5 million) of incremental after-tax cash flows, which were not included in reported earnings.

Non-GAAP Measures

This news release contains references to adjusted operating earnings, which represent earnings applicable to common shareholders adjusted for non-operating factors. Management believes that the presentation of adjusted operating earnings provides useful information to investors and shareholders as it provides increased predictive value. Management uses adjusted operating earnings to set targets and assess performance of the Company. Also, the Company's dividend payout target is based on adjusted operating earnings. Adjusted operating earnings is not a measure that has a standardized meaning prescribed by GAAP and is not considered a GAAP measure; therefore, this measure may not be comparable with a similar measure presented by other issuers.



Liquids Pipelines
----------------------------------------------------------------------------
Three months ended
March 31,
----------------------
(millions of Canadian dollars) 2008 2007
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Enbridge System 51.7 49.1
Athabasca System 13.4 13.6
Olympic Pipeline 2.4 3.7
Spearhead Pipeline 3.2 1.3
Southern Lights Pipeline 4.7 -
Feeder Pipelines and Other 0.7 1.2
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Earnings 76.1 68.9
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----------------------------------------------------------------------------


- Enbridge System earnings were $2.6 million higher than the prior year due to the AEDC on both Southern Access Mainline Expansion and Alberta Clipper Project. These increases were partially offset by increased taxes in the Terrace component.

- Olympic Pipeline earnings decreased due to increased operating costs related to the timing of planned maintenance.

- Spearhead Pipeline earnings increased compared with the prior year as a result of higher throughputs.

- Southern Lights Pipeline earnings reflected AEDC recognized while the project is under construction.



Gas Pipelines
----------------------------------------------------------------------------
Three months ended
March 31,
----------------------
(millions of Canadian dollars) 2008 2007
----------------------------------------------------------------------------
Alliance Pipeline US 8.8 7.5
Vector Pipeline 4.0 3.8
Enbridge Offshore Pipelines 5.4 14.4
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Earnings 18.2 25.7
----------------------------------------------------------------------------
----------------------------------------------------------------------------


- Increased earnings from Alliance Pipeline US reflected $2.8 million of proceeds from the settlement of a claim against a former shipper which repudiated its capacity commitment, partially offset by the effect of the weaker U.S. dollar and the depreciating rate base.

- Vector Pipeline earnings improved slightly, despite the weaker U.S. dollar, due to a system expansion put into service in the fourth quarter of 2007 as well as lower operating costs.

- Enbridge Offshore Pipelines (Offshore) earnings for the three months ended March 31, 2008 were $9.0 million lower than the prior year. In 2007, earnings included insurance proceeds of $5.3 million related to the replacement of damaged infrastructure and $6.0 million from business interruption policies related to lost revenue in 2005 and 2006 as a result of the 2005 hurricanes. A smaller final insurance claim settlement is expected in 2008.

- Excluding insurance recoveries, Offshore quarterly earnings increased by $2.3 million reflecting stand-by fees on the Neptune oil and gas pipelines as well as contributions from Atlantis platform volumes. These increases were partially offset by continuing natural production declines and the effect of the weaker U.S. dollar.



Sponsored Investments
----------------------------------------------------------------------------
Three months ended
March 31,
----------------------
(millions of Canadian dollars) 2008 2007
----------------------------------------------------------------------------
Enbridge Energy Partners 15.0 8.2
Enbridge Income Fund 11.6 9.6
Dilution Gain 4.5 -
----------------------------------------------------------------------------
Earnings 31.1 17.8
----------------------------------------------------------------------------
----------------------------------------------------------------------------


- Earnings from EEP included $1.3 million (net to Enbridge) of unrealized fair value gains on derivative financial instruments compared with unrealized fair value losses of $2.0 million in 2007.

- The increase in EEP's adjusted operating earnings from $10.2 million to $13.7 million for the three months ended March 31, 2008 reflected higher incentive income and, within EEP, higher oil transportation revenue, stronger processing margins and improved access to natural gas markets through expanded facilities, partially offset by the weaker U.S. dollar.

- Enbridge Income Fund earnings for the three months ended March 31, 2008 included proceeds of $1.3 million from the settlement of a claim against a former shipper on Alliance Canada which repudiated its capacity commitment.

- In March 2008, EEP issued Class A units and, because Enbridge did not fully participate, a dilution gain of $4.5 million resulted and Enbridge's ownership interest in EEP decreased from 15.1% to 14.6%.



Gas Distribution and Services
----------------------------------------------------------------------------
Three months ended
March 31,
----------------------
(millions of Canadian dollars) 2008 2007
----------------------------------------------------------------------------
Enbridge Gas Distribution 98.4 86.2
Noverco 15.8 17.0
Enbridge Gas New Brunswick 3.2 2.8
Other Gas Distribution 5.7 5.3
Energy Services 9.4 (1.4)
Aux Sable 22.3 (2.3)
Other (1.0) 1.5
----------------------------------------------------------------------------
Earnings 153.8 109.1
----------------------------------------------------------------------------
----------------------------------------------------------------------------


- After adjusting for the effect of colder than normal weather, EGD's earnings were $84.7 million for the three months ended March 31, 2008, comparable with $84.8 million in 2007.

- Under Incentive Regulation, as initially reflected in results for the first quarter of 2008, EGD's fixed charge per customer increased with a corresponding decrease in the per unit volumetric charge. These changes modify the quarterly earnings profile, but do not materially affect full year earnings as revenues are shifted from the colder winter quarters to the warmer summer quarters. The negative first quarter impact of this change was offset by customer growth and increased distribution rates.

- Energy Services earnings in 2007 reflected $4.3 million of unrealized fair value losses on derivative instruments. After adjusting for unrealized derivative fair value losses, Energy Services earnings were $9.4 million for the three months ended March 31, 2008 compared with $2.9 million for the three months ended March 31, 2007. This earnings increase was due to improved earnings from Tidal Energy, which resulted from higher margins captured on storage and transportation contracts as well as increased transportation and storage volumes.

- Aux Sable earnings reflected unrealized fair value gains on derivative financial instruments of $18.9 million (2007 - losses of $2.8 million). These financial instruments are used to mitigate the uncertainty of the Company's share of the contingent upside sharing mechanism, which allows Aux Sable to share in natural gas processing margins in excess of certain thresholds. Aux Sable adjusted operating earnings increased from $0.5 million in 2007 to $3.4 million in 2008 due to strong fractionation margins which enabled the Company to recognize earnings from the upside sharing mechanism.



International
----------------------------------------------------------------------------
Three months ended
March 31,
----------------------
(millions of Canadian dollars) 2008 2007
----------------------------------------------------------------------------
CLH 9.2 14.5
OCENSA/CITCol 8.3 8.3
Other (1.2) (0.8)
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Earnings 16.3 22.0
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----------------------------------------------------------------------------


- During the quarter, the Company entered into a derivative contract to hedge the impact of changes in the euro on CLH earnings. An unrealized fair value loss of $2.8 million related to this contract was recorded in the quarter. CLH earnings were also negatively impacted by the weaker euro prior to implementing the hedge.



Corporate
----------------------------------------------------------------------------
Three months ended
March 31,
----------------------
(millions of Canadian dollars) 2008 2007
----------------------------------------------------------------------------
Corporate (44.2) (16.5)
----------------------------------------------------------------------------
----------------------------------------------------------------------------


- Results from Corporate were weaker due to an unfavourable court decision related to the tax basis of previously owned U.S. pipeline assets which resulted in the recognition of $32.2 million income tax expense. This charge was partially offset by a $4.9 million gain on the sale of a corporate aircraft.

Conference Call

Enbridge will hold a conference call on May 7, 2008 at 9:00 a.m. Eastern time (7:00 a.m. Mountain time) to discuss the first quarter 2008 results. Analysts, members of the media and other interested parties wanting to participate should phone 1-888-396-2386 using the access code of 78534349. The call will be audio webcast live at www.enbridge.com/investor and an audio replay will be available shortly thereafter at 1-888-286-8010 using the access code 43914129. In addition, a webcast replay will be available approximately two hours after the conclusion of the event and a transcript will be posted to the website within approximately 24 hours.

The conference call will begin with a presentation by the Company's Chief Executive Officer and Chief Financial Officer followed by a question and answer period for investment analysts. A question and answer period for members of the media will immediately follow.

The unaudited interim consolidated financial statements and Management's Discussion and Analysis, which contain additional notes and disclosures, are available on the Enbridge website.

Enbridge Inc., a Canadian company, is a leader in energy transportation and distribution in North America and internationally. As a transporter of energy, Enbridge operates, in Canada and the U.S., the world's longest crude oil and liquids transportation system. The Company also has international operations and a growing involvement in the natural gas transmission and midstream businesses. As a distributor of energy, Enbridge owns and operates Canada's largest natural gas distribution company, and provides distribution services in Ontario, Quebec, New Brunswick and New York State. Enbridge employs approximately 5,500 people, primarily in Canada, the United States and South America. Enbridge's common shares trade on the Toronto Stock Exchange in Canada and on the New York Stock Exchange in the U.S. under the symbol ENB. Information about Enbridge is available on the Company's website at www.enbridge.com.

FORWARD-LOOKING INFORMATION

Forward-looking information, or forward-looking statements, have been included in this news release to provide Enbridge Inc. shareholders and potential investors with information about the Company and its subsidiaries, including management's assessment of Enbridge's and its subsidiaries' future plans and operations. This information may not be appropriate for other purposes. Forward-looking statements are typically identified by words such as "anticipate", "expect", "project", "estimate", "forecast", "plan", "intend", "target", "believe" and similar words suggesting future outcomes or statements regarding an outlook. Although Enbridge believes that these forward-looking statements are reasonable based on the information available on the date such statements are made and processes used to prepare the information, such statements are not guarantees of future performance and readers are cautioned against placing undue reliance on forward-looking statements. By their nature, these statements involve a variety of assumptions, known and unknown risks and uncertainties and other factors, which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by such statements. Material assumptions include assumptions about the expected supply and demand for crude oil, natural gas and natural gas liquids; prices of crude oil, natural gas and natural gas liquids; expected exchange rates; inflation; interest rates; the availability and price of labour and pipeline construction materials; operational reliability; anticipated in-service dates and weather.

Enbridge's forward-looking statements are subject to risks and uncertainties pertaining to operating performance, regulatory parameters, weather, economic conditions, exchange rates, interest rates and commodity prices, including but not limited to those risks and uncertainties discussed in this news release and in the Company's other filings with Canadian and United States securities regulators. The impact of any one risk, uncertainty or factor on a particular forward-looking statement is not determinable with certainty as these are interdependent and Enbridge's future course of action depends on management's assessment of all information available at the relevant time. Except to the extent required by law, Enbridge assumes no obligation to publicly update or revise any forward-looking statements made in this news release or otherwise, whether as a result of new information, future events or otherwise. All subsequent forward-looking statements, whether written or oral, attributable to Enbridge or persons acting on the Company's behalf, are expressly qualified in their entirety by these cautionary statements.



ENBRIDGE INC.
CONSOLIDATED STATEMENTS OF EARNINGS
----------------------------------------------------------------------------
Three months ended
March 31,
------------------------
(unaudited; millions of Canadian dollars, except
per share amounts) 2008 2007
----------------------------------------------------------------------------
Revenues
Commodity sales 3,244.7 2,686.6
Transportation 599.8 602.3
Energy services 123.3 69.3
----------------------------------------------------------------------------
3,967.8 3,358.2
----------------------------------------------------------------------------
Expenses
Commodity costs 3,065.5 2,531.8
Operating and administrative 290.7 280.3
Depreciation and amortization 154.2 147.1
----------------------------------------------------------------------------
3,510.4 2,959.2
----------------------------------------------------------------------------
457.4 399.0
Income from Equity Investments 60.3 44.0
Other Investment Income 54.2 41.6
Interest Expense (134.3) (140.6)
----------------------------------------------------------------------------
437.6 344.0
Non-Controlling Interests (17.3) (5.6)
----------------------------------------------------------------------------
420.3 338.4
Income Taxes (167.3) (109.7)
----------------------------------------------------------------------------
Earnings 253.0 228.7
Preferred Share Dividends (1.7) (1.7)
----------------------------------------------------------------------------
Earnings Applicable to Common Shareholders 251.3 227.0
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Earnings per Common Share 0.70 0.65
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----------------------------------------------------------------------------
Diluted Earnings per Common Share 0.70 0.64
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ENBRIDGE INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
----------------------------------------------------------------------------
Three months ended
March 31,
------------------------
(unaudited; millions of Canadian dollars) 2008 2007
----------------------------------------------------------------------------
Earnings 253.0 228.7
Other Comprehensive Income/(Loss)
Change in unrealized (losses)/gains on cash flow
hedges, net of tax (4.0) 9.2
Reclassification to earnings of realized cash flow
hedges, net of tax 4.4 7.3
Other comprehensive loss from equity investees (7.4) (10.2)
Non-controlling interest in other comprehensive
income 5.3 5.8
Change in foreign currency translation adjustment 173.2 (30.8)
Change in unrealized (losses)/gains on net
investment hedges, net of tax (92.3) 2.1
----------------------------------------------------------------------------
Other Comprehensive Income/(Loss) 79.2 (16.6)
----------------------------------------------------------------------------
Comprehensive Income 332.2 212.1
----------------------------------------------------------------------------
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ENBRIDGE INC.
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
----------------------------------------------------------------------------
Three months ended
March 31,
------------------------
(unaudited; millions of Canadian dollars, except
per share amounts) 2008 2007
----------------------------------------------------------------------------
Preferred Shares 125.0 125.0
----------------------------------------------------------------------------
Common Shares
Balance at beginning of period 3,026.5 2,416.1
Common shares issued - 566.4
Dividend reinvestment and share purchase plan 38.7 4.7
Shares issued on exercise of stock options 11.9 3.8
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Balance at End of Period 3,077.1 2,991.0
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Contributed Surplus
Balance at beginning of period 25.7 18.3
Stock-based compensation 8.5 5.0
Options exercised (0.9) (0.3)
----------------------------------------------------------------------------
Balance at End of Period 33.3 23.0
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Retained Earnings
Balance at beginning of period 2,537.3 2,322.7
Earnings applicable to common shareholders 251.3 227.0
Common share dividends (121.8) (112.9)
Dividends paid to reciprocal shareholder 3.7 3.4
Cumulative impact of change in accounting policy - (47.0)
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Balance at End of Period 2,670.5 2,393.2
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Accumulated Other Comprehensive Loss
Balance at beginning of period (285.0) (135.8)
Cumulative impact of change in accounting policy - 48.2
Other comprehensive income/(loss) 79.2 (16.6)
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Balance at End of Period (205.8) (104.2)
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Reciprocal Shareholding
Balance at beginning of period (154.3) (135.7)
Participation in common shares issued - (18.6)
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Balance at End of Period (154.3) (154.3)
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Total Shareholders' Equity 5,545.8 5,273.7
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----------------------------------------------------------------------------
Dividends Paid per Common Share 0.3300 0.3075
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ENBRIDGE INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
----------------------------------------------------------------------------
Three months ended
March 31,
------------------------
(unaudited; millions of Canadian dollars) 2008 2007
----------------------------------------------------------------------------
Operating Activities
Earnings 253.0 228.7
Depreciation and amortization 154.2 147.1
Unrealized (gains)/losses on derivative instruments (20.7) 7.1
Equity earnings in excess of cash distributions (42.4) (24.7)
Gain on reduction of ownership interest (12.3) -
Future income taxes 118.1 65.7
Non-controlling interests 17.3 5.6
Other 4.8 (12.7)
Changes in operating assets and liabilities 283.9 349.1
----------------------------------------------------------------------------
755.9 765.9
----------------------------------------------------------------------------
Investing Activities
Long-term investments (5.2) (0.6)
Additions to property, plant and equipment (612.0) (443.8)
Change in construction payable 5.3 (42.1)
----------------------------------------------------------------------------
(611.9) (486.5)
----------------------------------------------------------------------------
Financing Activities
Net change in short-term borrowings and short-term
debt 105.8 (574.1)
Net change in non-recourse short-term debt 1.2 3.3
Long-term debt issues - 462.9
Long-term debt repayments (100.0) (534.5)
Non-recourse long-term debt issues 1.2 14.4
Non-recourse long-term debt repayments (0.7) (0.5)
Distributions to non-controlling interests (3.9) (5.7)
Common shares issued 48.4 567.5
Preferred share dividends (1.7) (1.7)
Common share dividends (121.7) (112.9)
----------------------------------------------------------------------------
(71.4) (181.3)
----------------------------------------------------------------------------
Increase in Cash and Cash Equivalents 72.6 98.1
Cash and Cash Equivalents at Beginning of Period 166.7 139.7
----------------------------------------------------------------------------
Cash and Cash Equivalents at End of Period 239.3 237.8
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ENBRIDGE INC.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
----------------------------------------------------------------------------
March 31, December 31,
(unaudited; millions of Canadian dollars) 2008 2007
----------------------------------------------------------------------------
Assets
Current Assets
Cash and cash equivalents 239.3 166.7
Accounts receivable and other 2,692.7 2,388.7
Inventory 356.7 709.4
----------------------------------------------------------------------------
3,288.7 3,264.8
Property, Plant and Equipment, net 13,174.3 12,597.6
Long-Term Investments 2,251.3 2,076.3
Deferred Amounts and Other Assets 1,173.1 1,182.0
Intangible Assets 213.5 212.0
Goodwill 390.4 388.0
Future Income Taxes 144.4 186.7
----------------------------------------------------------------------------
20,635.7 19,907.4
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Liabilities and Shareholders' Equity
Current Liabilities
Short-term borrowings 112.6 545.6
Accounts payable and other 2,455.6 2,213.8
Interest payable 103.9 89.1
Current maturities of long-term debt 602.7 605.2
Current maturities of non-recourse debt 62.7 61.1
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3,337.5 3,514.8
Long-Term Debt 8,262.7 7,729.0
Non-Recourse Long-Term Debt 1,527.8 1,508.4
Other Long-Term Liabilities 245.8 253.9
Future Income Taxes 1,043.8 975.6
Non-Controlling Interests 672.3 650.5
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15,089.9 14,632.2
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Shareholders' Equity
Share capital
Preferred shares 125.0 125.0
Common shares 3,077.1 3,026.5
Contributed surplus 33.3 25.7
Retained earnings 2,670.5 2,537.3
Accumulated other comprehensive loss (205.8) (285.0)
Reciprocal shareholding (154.3) (154.3)
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5,545.8 5,275.2
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20,635.7 19,907.4
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ENBRIDGE INC.
SEGMENTED INFORMATION
----------------------------------------------------------------------------

Three months ended March 31, 2008
----------------------------------------------------------------------------
Gas
(unaudited; millions of Liquids Gas Sponsored Distribution
Canadian dollars) Pipelines Pipelines Investments and Services
----------------------------------------------------------------------------
Revenues 274.4 82.6 69.2 3,536.5
Commodity costs - - - (3,065.5)
Operating and
administrative (109.1) (21.8) (19.8) (131.8)
Depreciation and
amortization (40.3) (21.0) (19.1) (71.9)
----------------------------------------------------------------------------
125.0 39.8 30.3 267.3
Income from equity
investments (0.3) - 35.1 13.6
Other investment income 8.0 4.8 19.8 3.3
Interest and preferred
share dividends (24.6) (15.4) (15.8) (51.1)
Non-controlling interest (0.3) - (15.0) (1.6)
Income taxes (31.7) (11.0) (23.3) (77.7)
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Earnings applicable to
common shareholders 76.1 18.2 31.1 153.8
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----------------------------------------------------------------------------


----------------------------------------------------------------------------

Three months ended March 31, 2008
----------------------------------------------------------------------------
(unaudited; millions of
Canadian dollars) International Corporate Consolidated
----------------------------------------------------------------------------
Revenues 2.7 2.4 3,967.8
Commodity costs - - (3,065.5)
Operating and
administrative (3.5) (4.7) (290.7)
Depreciation and
amortization (0.2) (1.7) (154.2)
----------------------------------------------------------------------------
(1.0) (4.0) 457.4
Income from equity investments 11.9 - 60.3
Other investment income 5.4 12.9 54.2
Interest and preferred
share dividends - (29.1) (136.0)
Non-controlling interest - (0.4) (17.3)
Income taxes - (23.6) (167.3)
----------------------------------------------------------------------------
Earnings applicable to
common shareholders 16.3 (44.2) 251.3
----------------------------------------------------------------------------
----------------------------------------------------------------------------


----------------------------------------------------------------------------

Three months ended March 31, 2007
----------------------------------------------------------------------------
Gas
(unaudited; millions of Liquids Gas Sponsored Distribution
Canadian dollars) Pipelines Pipelines Investments and Services
----------------------------------------------------------------------------
Revenues 273.7 86.6 63.6 2,929.4
Commodity costs - - - (2,531.8)
Operating and
administrative (101.9) (20.3) (17.4) (132.4)
Depreciation and
amortization (39.0) (23.0) (18.2) (65.4)
----------------------------------------------------------------------------
132.8 43.3 28.0 199.8
Income from equity
investments (0.3) - 16.6 13.3
Other investment income 0.2 15.3 1.0 4.1
Interest and preferred
share dividends (25.1) (17.6) (15.2) (52.8)
Non-controlling interest (0.2) - (4.0) (1.3)
Income taxes (38.5) (15.3) (8.6) (54.0)
----------------------------------------------------------------------------
Earnings applicable to
common shareholders 68.9 25.7 17.8 109.1
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----------------------------------------------------------------------------


----------------------------------------------------------------------------

Three months ended March 31, 2007
----------------------------------------------------------------------------
(unaudited; millions of
Canadian dollars) International Corporate Consolidated
----------------------------------------------------------------------------
Revenues 2.7 2.2 3,358.2
Commodity costs - - (2,531.8)
Operating and
administrative (3.8) (4.5) (280.3)
Depreciation and
amortization (0.2) (1.3) (147.1)
----------------------------------------------------------------------------
(1.3) (3.6) 399.0
Income from equity
investments 14.8 (0.4) 44.0
Other investment income 8.9 12.1 41.6
Interest and preferred
share dividends - (31.6) (142.3)
Non-controlling interest - (0.1) (5.6)
Income taxes (0.4) 7.1 (109.7)
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Earnings applicable to
common shareholders 22.0 (16.5) 227.0
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ENBRIDGE INC.
HIGHLIGHTS
----------------------------------------------------------------------------
Three months ended
March 31,
------------------------
(unaudited; millions of Canadian dollars, except
per share amounts) 2008 2007
----------------------------------------------------------------------------
Earnings Applicable to Common Shareholders
Liquids Pipelines 76.1 68.9
Gas Pipelines 18.2 25.7
Sponsored Investments 31.1 17.8
Gas Distribution and Services 153.8 109.1
International 16.3 22.0
Corporate (44.2) (16.5)
----------------------------------------------------------------------------
251.3 227.0
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Cash Flow Data
Cash provided by operating activities before
changes in operating assets and liabilities 472.0 416.8
Cash provided by operating activities 755.9 765.9
Additions to property, plant and equipment 612.0 443.8
Common share dividends 121.7 112.9
----------------------------------------------------------------------------
Per Common Share Information
Earnings per Common Share 0.70 0.65
Diluted Earnings per Common Share 0.70 0.64
Dividends per Common Share 0.3300 0.3075
----------------------------------------------------------------------------
Shares Outstanding
Weighted Average Common Shares Outstanding
(millions) 357.9 350.7
Diluted Weighted Average Common Shares
Outstanding (millions) 361.0 354.2
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Operating Data
Liquids Pipelines - Deliveries (thousands of
barrels per day)
Enbridge System(1) 2,082 2,082
Athabasca System(2) 198 190
Spearhead Pipeline 105 89
Olympic Pipeline 293 290
Gas Pipelines - Average Daily Throughput Volume
(millions of cubic feet per day)
Alliance Pipeline US 1,685 1,676
Vector Pipeline 1,428 1,007
Enbridge Offshore Pipelines 1,778 2,021
Gas Distribution and Services(3)
Volumes (billion cubic feet) 192 191
Number of active customers (thousands) 1,918 1,874
Degree day deficiency(4)
Actual 1,888 1,908
Forecast based on normal weather 1,756 1,894
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1. Enbridge System includes Canadian mainline deliveries in Western Canada
and to the Lakehead System at the U.S. border as well as Line 8 and Line
9 in Eastern Canada.
2. Volumes are for the Athabasca mainline only and do not include laterals
on the Athabasca System.
3. Gas Distribution and Services volumes and the number of active customers
are derived from the aggregate system supply and direct purchase gas
supply arrangements.
4. Degree day deficiency is a measure of coldness which is indicative of
volumetric requirements of natural gas utilized for heating purposes. It
is calculated by accumulating for each day in the period the total number
of degrees each day by which the daily mean temperature falls below 18
degrees Celsius. The figures given are those accumulated in the Greater
Toronto Area.

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