Energy Savings Income Fund

Today I added to my holdings of Energy Savings Income Fund. Energy Savings' business involves the sale of natural gas and electricity to residential, small to mid-size commercial and small industrial customers under long-term, irrevocable fixed price contracts (price protected for electricity). Energy Savings offers natural gas in Manitoba, Quebec, British Columbia, Illinois and Indiana and both gas and electricity in Ontario, Alberta and New York and, effective May 2007, electricity in Texas. By securing the price for natural gas or electricity under such contracts for a period of up to five years, Energy Savings' customers reduce or eliminate their exposure to changes in the price of these essential commodities.

Energy Savings recently announced is 18th distribution increase and currently yields 8.1%. Its earnings are stable (r2 = 0.90)

Highlights for the quarter ended June 30, 2007 included:

- Customer base reached 1,678,000, up 6% year over year. Gross additions through marketing were 95,000 up from 62,000 in Q4 and 65,000 in Q3.

- Sales (seasonally adjusted) up 17% reaching $374.3 million year over year.

- Gross margin (seasonally adjusted) of $55.3 million up 15%.

- Distributable cash after gross margin replacement of $30.8 million ($0.29 per unit) down 2%.

- Distributable cash of $26.7 million after all marketing expenses up 24%.

- Net income of $25.9 million, up 135% from $11.0 million year over year.

- Distributions up 19% year over year ending the quarter at $1.165 per unit with a subsequent increase to $1.21 per unit announced effective the September 30th payment.