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IOWA-ILLINOIS GAS AND ELECTRIC DECLARES QUARTERLY CASH DIVIDEND

 DAVENPORT, Iowa, Jan. 28 /PRNewswire/ -- A quarterly cash dividend of 43.25 cents per share on Iowa-Illinois Gas and Electric Co. (NYSE: IWG) common shares was declared today by the company's board of directors at a meeting in Davenport. The dividend will be payable March 1, 1993 to shareholders of record at the close of business Feb. 8, 1993. The quarterly dividend rate of 43.25 cents per share was established in January 1992.
 "The decision to maintain the quarterly dividend at the 43.25 cents per share level followed a careful evaluation of the company's dividend policy by the board in light of the company's declining earnings in 1992 and the expectation that 1993 earnings may remain below the 1991 level (of $1.86 per share)," said Stan Bright, chairman and chief executive officer. Earnings for 1992, which will be released in early February, are expected to be in the range of the $1.45 per share reported for the 12 months ended Sept. 31, 1992. Despite the current earnings situation, the company's cash flow, on a per share basis, will continue to substantially exceed the dividend level.
 "It will be difficult to improve earnings in our utility operations over the next several years given the expected low rate of growth in gas and electric sales and continuing increases in costs of operating the company's electric generating stations, including our 25 percent ownership interest in the Quad-Cities Nuclear Power Station," Bright said. "In addition, our allowed rates of return are lower than in the past. These rates of return are determined by regulatory authorities based on current and expected capital market conditions.
 "As a part of its evaluation of the company's dividend policy, the board reviewed progress to date on programs which have been implemented by the company to reduce costs. These programs should enhance the prospects for earnings recovery in 1993 and 1994," Bright said. "In this environment, it will be necessary to continue consideration of the common stock dividend level each quarter."
 The board also declared the regular quarterly dividend on preferred and preference shares, payable May 1, 1993 to shareholders of record April 8, 1993.
 Iowa-Illinois serves more than 196,000 electric customers and more than 235,000 natural gas customers in central and eastern Iowa and western Illinois. The company's wholly owned non-regulated subsidiary, InterCoast Energy Co., is engaged in energy businesses, including oil and gas, energy project development, equity investments in energy- related firms and financial investments.
 Iowa-Illinois' common shares are traded on the New York and Midwest Stock Exchanges under the symbol IWG. Common share quotations are listed in the New York Stock Exchange Composite Transactions under: IowaIllGas.
 -0- 1/28/93
 /CONTACT: Barbara VenHorst of Iowa-Illinois Gas and Electric, 319-326-7277/
 (IWG)


CO: Iowa-Illinois Gas and Electric ST: Iowa IN: UTI SU: DIV

MC -- DV009 -- 0472 01/28/93 16:57 EST
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Publication:PR Newswire
Date:Jan 28, 1993
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