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NEW ENGLAND ELECTRIC REPORTS THIRD QUARTER EARNINGS

 WESTBOROUGH, Mass., Oct. 22 /PRNewswire/ -- New England Electric System (NYSE: NES)(NEES) today reported earnings for the third quarter of 1993 of 85 cents per share. This compares to 74 cents per share earned in the third quarter of 1992. The increase primarily reflects increased revenues resulting from an 8.6 percent increase in kilowatthour (KWH) sales to ultimate customers in the third quarter. This increase in KWH sales includes the effects of a return to more normal weather conditions during the third quarter of 1993 vs. the cooler than normal conditions experienced during the same period last year. The increase in earnings per share also reflects the continuing effects of Massachusetts Electric Company's (Massachusetts Electric) $45 million rate increase which went into effect in October 1992, as well as decreased interest costs achieved through corporate debt refinancings. These increases were


partially offset by increased purchased power costs associated with scheduled plant overhauls by nuclear power suppliers. In addition, earnings were reduced due to the effects of the increase in the Federal corporate income tax rate from 34 percent to 35 percent retroactive to Jan. 1, 1993.
 NEES earnings for the first nine months of 1993 were $1.97 per share. These earnings include a 21 cent per share charge against earnings recorded in the second quarter of related to potential response costs for wastes associated with a number of manufactured gas locations operated by Massachusetts gas utilities once owned by NEES, and a 27 cent charge against earnings recorded in the first quarter for the costs associated with an early retirement offer and a special severance program for non-union employees undertaken by NEES subsidiaries as part of an organizational review. Earnings for the first nine months of 1993 excluding these charges were $2.45 per share as compared to $2.20 per share earned for the same period last year. The increase primarily reflects retail rate increases as well as the KWH sales growth in the third quarter of 1993 and reduced interest costs. The increase also reflects lower costs of scheduled overhauls at New England Power Company's generating units in the first nine months of 1993. KWH sales to ultimate customers in the first nine months of 1993 increased 2.4 percent from the corresponding period last year.
 Earnings for the third quarter and first nine months of 1993 do not reflect the effects of a previously announced rate agreement filed by Massachusetts Electric on Oct. 14, 1993 with the Massachusetts Department of Public Utilities (MDPU). The effects of this rate agreement will not be recorded until it is acted upon by the MDPU.
 New England Electric System And Subsidiaries (Consolidated)
 Periods Ended Sept. 30, 1993
 Quarter Nine Months Twelve Months
 Operating revenue $576,644,000 $1,674,270,000 $2,241,047,000
 Net income $ 55,531,000 $ 128,263,000 $ 170,292,000
 Avg. common shares 64,969,652 64,969,652 64,969,652
 Net inc. per avg.
 share $.85 $1.97 $2.62
 Periods Ended Sept. 30, 1992
 Quarter Nine Months Twelve Months
 Operating revenue $540,929,000 $1,614,899,000 $2,139,266,000
 Net inc. $ 48,447,000 $ 143,008,000 $ 185,437,000
 Avg. common shares 64,969,652 64,969,652 64,969,652
 Net inc. per avg.
 share $.74 $2.20 $2.85
 -0- 10/22/93
 /CONTACT: Robert G. Seega of New England Electric, 508-366-9011 (days), 508-949-1796 (evenings)/
 (NES)


CO: New England Electric System ST: Massachusetts IN: UTI SU: ERN

DJ-JL -- NE008 -- 5871 10/22/93 16:08 EDT
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Publication:PR Newswire
Date:Oct 22, 1993
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