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<P>
<CENTER>SECURITIES AND EXCHANGE COMMISSION</CENTER>
<P></P>
<P>
<CENTER>Washington, D.C. 20549</CENTER>
<P></P>
<P>
<CENTER>FORM 8-K</CENTER>
<P></P>
<P>
<CENTER>CURRENT REPORT</CENTER>
<P></P>
<P>
<CENTER>Pursuant to Section 13 or 15(d) of</CENTER>
<P></P>
<P>
<CENTER>The Securities and Exchange Act of 1934</CENTER>
<P></P>
<P>
<CENTER>&nbsp;</CENTER>
<P></P>
<P>
<CENTER>Date of Report: July 2, 2003</CENTER>
<P></P>
<P>
<CENTER>Date of earliest event reported: June 30, 2003</CENTER>
<P></P>
<P>
<CENTER>&nbsp;</CENTER>
<P></P>
<P>
<CENTER>MAINE PUBLIC SERVICE COMPANY</CENTER>
<P></P>
<P>
<CENTER>(Exact name of registrant as specified in its charter)</CENTER>
<P></P>
<P>
<CENTER>&nbsp;</CENTER>
<P></P>
<P>
<CENTER>Maine</CENTER>
<P></P>
<P>
<CENTER>(State or other jurisdiction of</CENTER>
<P></P>
<P>
<CENTER>incorporation or organization)</CENTER>
<P></P>
<P>
<CENTER>1-3429</CENTER>
<P></P>
<P>
<CENTER>(Commission File No.)</CENTER>
<P></P>
<P>
<CENTER>01-0113635</CENTER>
<P></P>
<P>
<CENTER>(I.R.S. Employer Identification No.)</CENTER>
<P></P>
<P>
<CENTER>209 State Street, Presque Isle, Maine 04769</CENTER>
<P></P>
<P>
<CENTER>(Address of principal executive offices) (Zip Code)</CENTER>
<P></P>
<P>
<CENTER>Registrant's telephone number: 207-768-5811</CENTER>
<P></P>
<P>
<CENTER>&nbsp;</CENTER>
<P></P>
<P>
<CENTER>Maine Public Service Company</CENTER>
<P></P>
<P>&nbsp;</P>
<P>Item 5. Other Events.</P>
<P>Maine Public Service Company Reorganizes Into Holding Company,<BR>and Changes
Ticker Symbol on AMEX and Reports Five-Month Earnings</P>
<P>As outlined in the Interim Report to Stockholders, dated July, 1, 2003, and
attached hereto as Exhibit 99.1, the reorganization of Maine Public Service
Company into a holding company, Maine &amp; Maritimes Corporation, became
effective on June 30, 2003. As a result of the reorganization, Maine Public
Service Company shares of common stock, formerly traded under the ticker symbol
"MAP," are no longer publicly traded, but were automatically converted to Maine
&amp; Maritimes Corporation shares on a one-to-one basis. Maine &amp; Maritimes
Corporation shares are now traded on the American Stock Exchange under the
ticker symbol "MAM."</P>
<P>The Interim Report also contains unaudited Financial Statements for the
five-month period ended May 31, 2003.</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>SIGNATURE</P>
<P>Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.</P>
<P>MAINE PUBLIC SERVICE COMPANY</P>
<P>Date: July 2, 2003</P>
<P>&nbsp;</P>
<P>By: /s/ J. Nicholas Bayne</P>
<P><BR>J. Nicholas Bayne, President</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P style="TEXT-ALIGN: center">
<CENTER><FONT size=+1>Exhibit 99.1</FONT></CENTER>
<P></P>
<P style="TEXT-ALIGN: center">
<CENTER><FONT size=+1>Maine &amp; Maritimes Corporation</FONT></CENTER>
<P></P>
<P style="TEXT-ALIGN: center">
<CENTER><B>Interim Report to Stockholders<BR>July 1, 2003</B></CENTER>
<P></P>
<P>This Interim Report to Stockholders presents consolidated financial results
for Maine &amp; Maritimes Corporation's subsidiary, Maine Public Service Company
("MPS"), and its subsidiaries, Energy Atlantic, LLC ("EA") and Maine and New
Brunswick Electrical Power Company, Limited, through the five months ended May
31, 2003. Energy Atlantic is scheduled to become a subsidiary of Maine &amp;
Maritimes Corporation during July, 2003.</P>
<P><B>Stockholders Approve Holding Company</B></P>
<P>During MPS's Annual Meeting of Shareholders, held on May 30, 2003,
stockholders voted overwhelmingly to approve its plan to create a holding
company structure, under the corporate name of Maine &amp; Maritimes Corporation
("MAM" or the "Company"). Of the shares eligible to vote, 57.07% voted "FOR" the
holding company proposal, and 10.19% voted "AGAINST." The reorganization into a
holding company structure became effective on June 30, 2003. No change in
beneficial ownership resulted from the reorganization, which is described in
more detail in the Form S-4/A of Maine &amp; Maritimes Corporation, filed with
the Securities and Exchange Commission on April 15, 2003.</P>
<P>Maine Public Service Company is now a separate subsidiary of Maine &amp;
Maritimes Corporation. Energy Atlantic, LLC, an unregulated Competitive
Electricity Supply company and Maine and New Brunswick Electrical Power Company,
Limited, which is an inactive Canadian company, are subsidiaries of MPS. During
the month of July, 2003, Energy Atlantic, LLC, will become a subsidiary of the
new holding company, Maine &amp; Maritimes Corporation.</P>
<P>Conversion to a holding company structure is part of the Company's overall
strategy to create long-term value and ensure market-competitive dividend
yields. Through the implementation of a holding company structure, your Board of
Directors and management remain committed to a fiscally conservative growth
strategy to hedge the impacts of deregulation and generation divestiture, as
well as the declining-to-static economy of MPS's northern Maine service area.
Our portfolio approach to growth provides for an increased ability to monetize
prudent market opportunities, while enabling increased strategy and enterprise
risk management.</P>
<P>
<CENTER>
<TABLE class=MsoNormalTable
style="WIDTH: 337.5pt; mso-cellspacing: 1.5pt; mso-padding-alt: 0in 0in 0in 0in"
cellSpacing=3 cellPadding=0 width=450 border=0>

  <TR style="mso-yfti-irow: 0; mso-yfti-lastrow: yes">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 100%; PADDING-TOP: 0in"
    width="100%">
      <P class=MsoNormal><B>As a result of reorganization into a holding
      company, Maine Public Service Company shares, formerly traded under the
      Ticker Symbol "MAP," are no longer publicly traded. Maine &amp; Maritimes
      Corporation shares are now traded on the American Stock Exchange under the
      Ticker Symbol "MAM."</B></P></TD></TR></TABLE></CENTER>
<P></P>
<P>&nbsp;</P>
<P>Shares of MPS Common Stock have been automatically converted into the same
number of shares of Common Stock of MAM. No exchange of certificates is
necessary. However, if you wish, a new certificate can be issued. To obtain a
new certificate, please write or call our Transfer Agent:</P>
<P>
<CENTER>The Bank of New York<BR>Shareholder Relations Dept. - 11E<BR>PO Box
11258<BR>Church Street Station<BR>New York, NY 10286<BR>Phone:
1-800-524-4458<BR>E-Mail: Shareownersvcs@bankofny.com</CENTER>
<P></P>
<P>For additional information, please visit our new web site at: http://www.maineandmaritimes.com/.
&nbsp;In an effort to keep stockholders and potential investors better informed,
we are expanding and enhancing our investor relations Internet presence. The
2002 Annual Report for Maine Public Service Company, Maine &amp; Maritimes
Corporation S-4/A Prospectus, President's Annual Meeting Report to Shareholders,
webcast from the American Stock Exchange, as well as our expanded corporate
governance provisions can now be viewed online.</P>
<P>
<CENTER>&nbsp;</CENTER>
<P></P>
<P>
<CENTER>
<TABLE class=MsoNormalTable
style="WIDTH: 495pt; mso-cellspacing: 1.5pt; mso-padding-alt: 0in 0in 0in 0in"
height=583 cellSpacing=3 cellPadding=0 width=660 border=0>

  <TR style="HEIGHT: 51.75pt; mso-yfti-irow: 0">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 99.4%; PADDING-TOP: 0in; HEIGHT: 51.75pt"
    colSpan=8>
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER>&nbsp;<B>Highlights</B></CENTER>
      <P></P>
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER>Five Months Ended May 31,</CENTER></TD></TR>
  <TR style="HEIGHT: 20.25pt; mso-yfti-irow: 1">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 99.4%; PADDING-TOP: 0in; HEIGHT: 20.25pt"
    colSpan=8>
      <P class=MsoNormal><I>(Dollars in Thousands Except Per Share
      Amounts)</I></P></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 2">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 33.84%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="30%" rowSpan=2></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 30.74%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    colSpan=3>
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER><B>&nbsp; &nbsp;2003</B></CENTER></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 2.38%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="7%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 31.52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    colSpan=3>
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER>&nbsp; &nbsp;<B>2002</B></CENTER></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 3">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 11.42%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER>&nbsp;<B>MWH</B></CENTER></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.7%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="3%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 15%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="12%">
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER><B>Dollars</B>&nbsp;</CENTER></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 2.38%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="7%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 8.52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="14%">
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER>&nbsp;<B>MWH</B></CENTER></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 1.86%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="4%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 20.52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="13%">
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER>&nbsp;<B>Dollars</B></CENTER></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 4">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 33.84%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="30%">
      <P class=MsoNormal>Revenues:</P></TD>
    <TD colSpan=7 rowSpan=2></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 5">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 33.84%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="30%">
      <P class=MsoNormal>Maine Public Service</P></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 6">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 33.84%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="30%">
      <P class=MsoNormal>- Retail</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 11.42%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="17%">
      <P style="TEXT-ALIGN: right" align=right>231,294</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.7%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="3%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 15%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="12%">
      <P style="TEXT-ALIGN: right" align=right>$13,768</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 2.38%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="7%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 8.52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="14%">
      <P style="TEXT-ALIGN: right" align=right>225,987</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 1.86%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="4%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 20.52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="13%">
      <P style="TEXT-ALIGN: right" align=right>$13,170</P></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 7">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 33.84%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="30%">
      <P class=MsoNormal>- Other</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 11.42%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="17%">
      <P style="TEXT-ALIGN: right" align=right>-</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.7%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="3%">
      <P class=MsoNormal>&nbsp;</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 15%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="12%">
      <P style="TEXT-ALIGN: right" align=right>57</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 2.38%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="7%">
      <P class=MsoNormal>&nbsp;</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 8.52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="14%">
      <P style="TEXT-ALIGN: right" align=right>&nbsp;-</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 1.86%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="4%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 20.52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="13%">
      <P style="TEXT-ALIGN: right" align=right>750</P></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 8">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 33.84%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="30%">
      <P class=MsoNormal>Energy Atlantic</P></TD>
    <TD colSpan=7></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 9">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 33.84%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="30%">
      <P class=MsoNormal>- Competitive Energy Supplier</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 11.42%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="17%">
      <P style="TEXT-ALIGN: right" align=right>53,660</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.7%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="3%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 15%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="12%">
      <P style="TEXT-ALIGN: right" align=right>2,929</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 2.38%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="7%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 8.52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="14%">
      <P style="TEXT-ALIGN: right" align=right>66,121</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 1.86%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="4%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 20.52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="13%">
      <P style="TEXT-ALIGN: right" align=right>2,474</P></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 10">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 33.84%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="30%">
      <P class=MsoNormal>&nbsp;- Standard Offer Margin</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 11.42%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="17%">
      <P style="TEXT-ALIGN: right" align=right>-</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.7%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="3%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 15%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="12%">
      <P style="TEXT-ALIGN: right" align=right>-</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 2.38%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="7%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 8.52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="14%">
      <P style="TEXT-ALIGN: right" align=right>629,193</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 1.86%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="4%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 20.52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="13%">
      <P style="TEXT-ALIGN: right" align=right>411</P></TD></TR>
  <TR style="HEIGHT: 24pt; mso-yfti-irow: 11">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 33.84%; PADDING-TOP: 0in; HEIGHT: 24pt"
    width="30%">
      <P class=MsoNormal>Total Revenues</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 11.42%; PADDING-TOP: 0in; HEIGHT: 24pt"
    width="17%">
      <P style="TEXT-ALIGN: right" align=right>284,954</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.7%; PADDING-TOP: 0in; HEIGHT: 24pt"
    width="3%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 15%; PADDING-TOP: 0in; HEIGHT: 24pt"
    width="12%">
      <P style="TEXT-ALIGN: right" align=right>$16,754</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 2.38%; PADDING-TOP: 0in; HEIGHT: 24pt"
    width="7%">
      <P class=MsoNormal>&nbsp;</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 8.52%; PADDING-TOP: 0in; HEIGHT: 24pt"
    width="14%">
      <P style="TEXT-ALIGN: right" align=right>921,301</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 1.86%; PADDING-TOP: 0in; HEIGHT: 24pt"
    width="4%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 20.52%; PADDING-TOP: 0in; HEIGHT: 24pt"
    width="13%">
      <P style="TEXT-ALIGN: right" align=right>$16,805</P></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 12">
    <TD colSpan=8></TD></TR>
  <TR style="HEIGHT: 31.5pt; mso-yfti-irow: 13">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 33.84%; PADDING-TOP: 0in; HEIGHT: 31.5pt"
    width="30%">
      <P class=MsoNormal>Net Income Available for Common Stock</P></TD>
    <TD colSpan=2>
      <P class=MsoNormal>&nbsp;</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 15%; PADDING-TOP: 0in; HEIGHT: 31.5pt"
    width="12%">
      <P style="TEXT-ALIGN: right" align=right>&nbsp;$1,640</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 2.38%; PADDING-TOP: 0in; HEIGHT: 31.5pt"
    width="7%"></TD>
    <TD colSpan=2></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 20.52%; PADDING-TOP: 0in; HEIGHT: 31.5pt"
    width="13%">
      <P style="TEXT-ALIGN: right" align=right>$2,182</P></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 14">
    <TD colSpan=8></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 15">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 33.84%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="30%">
      <P class=MsoNormal>Core T&amp;D</P></TD>
    <TD colSpan=2 rowSpan=3></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 15%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="12%">
      <P style="TEXT-ALIGN: right" align=right>1.27</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 2.38%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="7%"></TD>
    <TD colSpan=2 rowSpan=3></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 20.52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="13%">
      <P style="TEXT-ALIGN: right" align=right>1.30</P></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 16">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 33.84%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="30%">
      <P class=MsoNormal>Holding Company</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 15%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="12%">
      <P style="TEXT-ALIGN: right" align=right>(0.24)</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 2.38%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="14%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 20.52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="13%">
      <P style="TEXT-ALIGN: right" align=right>-</P></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 17">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 33.84%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="30%">
      <P class=MsoNormal>Energy Atlantic</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 15%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="12%">
      <P style="TEXT-ALIGN: right" align=right>0.01</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 2.38%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="14%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 20.52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="13%">
      <P style="TEXT-ALIGN: right" align=right>0.09</P></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 18">
    <TD colSpan=8></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 19; mso-yfti-lastrow: yes">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 33.84%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="30%">
      <P class=MsoNormal>Earnings Per Share</P></TD>
    <TD colSpan=2></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 15%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="12%">
      <P style="TEXT-ALIGN: right" align=right>$1.04</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 2.38%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="7%"></TD>
    <TD colSpan=2></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 20.52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="13%">
      <P style="TEXT-ALIGN: right"
align=right>$1.39</P></TD></TR></TABLE></CENTER>
<P></P>
<P><B>Business Activity Update</B></P>
<P>During the reporting period, a number of additional key business activities
have been undertaken to maintain and increase overall stockholder value.
Significant efforts are underway to control overall operating costs of MPS,
while seeking to increase revenues through prudent rate increases and economic
development. While we remain committed to ensuring the utmost in competitiveness
and financial strength of MPS, we have begun aggressive efforts to execute our
overall growth strategy for Maine &amp; Maritimes Corporation. These efforts
involve careful evaluation of market opportunities within those business areas
previously defined and more fully described during our webcast from the American
Stock Exchange and in the MPS 2002 Annual Report. As previously noted, these
items may be viewed on our web site. Given current market conditions, we are
encouraged by the number of economic opportunities within those target sectors
identified by the Company. All opportunities that the Company may wish to pursue
are being scrutinized on a conservative basis, reflecting our continuing
commitment to a fiscally conservative approach to business.</P>
<P><B>Maine</B> <B>Public Service</B></P>
<P>   Developed and filed an Alternative Rate Plan (ARP) - MPUC Docket No.
2003-85. On March 6, 2003, following a series of informal meetings with the
Office of Public Advocate and the Maine Public Utilities Commission ("MPUC"),
MPS submitted its formal Request for Approval of an Alternate Rate Plan ("ARP").
The proposal is a seven-year distribution rate plan with a target for
implementation on or before July 1, 2003. The ARP is an alternative form of
regulating MPS's distribution assets allowing for an increased correlation
between performance and allowable return on equity. The ARP has numerous
components, all of which have been designed to fit together as an integrated
whole that will allow MPS to continue to meet the unique needs of its northern
Maine customers, while protecting stockholder interests. Its key proposed
components include: an inflation index and productivity offset; an adjustment
for the treatment of extraordinary costs MPS may incur; an interest expense
adjustment; an economic conditions adjustment; a shareholder earnings sharing
mechanism; pricing flexibility; reliability safety and service quality indices;
and a sharing mechanism for non-core revenues. The proposed structure, if
approved, provides potential earnings upside for stockholders, subject to MPS's
achievement of specific customer-centric service quality indices. A proposed
distribution rate increase of 8.9% has also been requested. At this time, MPS
cannot predict the nature or the outcome of any decision or ruling by the MPUC
in this proceeding.</P>
<P><BR>   2003 Open Access Transmission Tariff ("OATT") Filing. MPS received
final agreement from the Federal Energy Regulatory Commission ("FERC") on its
2002 OATT in March 2003. MPS has begun negotiations with FERC and intervenors in
conjunction with its annual 2003 OATT Formula Rate filing. The initial
notification for the 2003 OATT filing was filed with FERC on March 31, 2003. In
its 2003 OATT filing, MPS has provided the proposed changes to its OATT Formula
Rate to the intervening parties and FERC staff. MPS believes that the Formula
Rate continues to produce reasonable results; however, it is recommending minor
modifications. MPS is hopeful it will reach agreement with the parties on the
OATT Formula Rate prior to June 30, 2003. If MPS, the intervenors, and FERC
staff are unable to reach a stipulated agreement, the matter may be submitted to
FERC for a formal proceeding. MPS expects that its overall transmission rate
will increase. MPS cannot predict the exact outcome or timing of any decision or
ruling by FERC regarding this filing.</P>
<P>   Implementation of Integrated Asset Management ("IAM") Program. In order to
control capital expenditures, control operating costs, and improve service
reliability, MPS is implementing a unique approach to asset management and
resource-centered maintenance. As a part of the migration to IAM, MPS's Power
Delivery group has been further divided into two different groups: (1) Field
Services and Engineering and (2) Asset Management. Under this organizational
model, Field Services is responsible for service delivery, while Engineering and
Asset Management are responsible for optimizing all transmission and
distribution assets. The overall program involves a new emphasis on
"in-sourcing" vegetation management and transmission construction, while
decentralizing crews to reduce "windshield time" and increase response time.
Additionally, a unique Field Inspection and Quality Control team is being
established to provide ongoing information concerning asset conditions, forming
an improved foundation for deployment of maintenance dollars, and overall system
planning. Unlike those asset management programs focused primarily on
"out-sourcing," MPS's approach ensures that its crews remain employed and
productive, and that it has the number of crews essential for handling emergency
outage situations. In-sourcing and new ways to increase the efficient operation
of a transmission and distribution utility are part of a long-term partnering
commitment between MPS's management and labor. These initiatives include an
"adopt a circuit" program, wherein specific crews become responsible for the
reliability of a specific portion of the MPS system, aligning incentives with
performance.</P>
<P>   Increased Commitment to Economic Development. MPS is undertaking
significant steps to enhance its economic development efforts in support of load
growth and overall enhancement of the service area by (a) initiating the
creation of a new regional public-private initiative, and (b) increasing the
area's focus on existing business retention and business recruitment. Building
on the new sense of cooperation and collaboration between the private and public
sectors, MPS is partnering with the Northern Maine Development Commission to
implement highly targeted and results-oriented initiatives. While MPS is highly
focused on cost containment and enhanced productivity, economic development is
the primary means for increasing total revenues of the utility.</P>
<P><B>Energy Atlantic</B></P>
<P>EA continues to evaluate southern and central Maine, as well as other New
England unregulated retail electricity markets concerning the market viability
for non-generation-owning Competitive Electricity Suppliers. Management of EA
believes that the ongoing decline of the wholesale electricity trading industry
will continue to make it extremely difficult to find wholesale suppliers with
reasonable credit and mark-to-market risk expectations. Given our desire to not
accept exposure to electricity commodity risks, EA has not found a wholesale
partner to allow its expanded retail marketing efforts within southern and
central Maine, as well as other New England markets with acceptable risk
profiles.</P>
<P>As previously stated, the expiration of EA's sales of Standard Offer Service
("SOS") in Central Maine Power Company's ("CMP's") service territory will
continue to adversely impact EA's revenues and net income and, correspondingly,
earnings. In 2002, EA realized a SOS margin in CMP's service territory of
approximately $5.8 million. The Company continues to review EA's current and
future business model, which may include a possible exit from the Competitive
Electricity Supply (CES) market. On February 24, 2003, EA announced its intent
to withdraw from serving new retail electricity markets in northern Maine due to
concerns over a lack of wholesale market liquidity and profitability in that
market. EA will continue to serve its existing customer contracts in northern
Maine until they expire in February, 2004. The Company will continue to evaluate
EA's participation in the CES market by assessing, among other things, EA's
ability to establish wholesale supply on a conservative and prudent credit and
risk basis.</P>
<P><B>Election of Directors and Officers</B></P>
<P>During the Maine Public Service Company Annual Stockholders Meeting, held on
May 30, 2003, its stockholders elected the following Class I Directors for terms
expiring in 2006: Robert E. Anderson (for re-election), Michael W. Caron (for
election), and Nathan L. Grass (for re-election). David N. Felch (for
re-election from Board appointment) was elected as a Class II Director, with a
term expiring in 2004. Mr. Caron and Mr. Felch have been assigned to the Pension
and Benefits Committee and the Audit Committee, strengthening the level of
financial expertise of both Board committees. Mr. Grass is Chairperson of the
Performance and Compensation Committee and is a member of the Corporate
Governance and Strategic Planning Committees. Mr. Anderson is Chairperson of the
Pension and Benefits Committee and is a member of the Strategic Planning
Committee.</P>
<P>Also on May 30, 2003, in MPS's Board of Directors meeting, its Directors
elected officers to serve until the next annual election of officers and until
their successors have been duly chosen and qualified. Those elected are as
follows: G. Melvin Hovey, Chairman of the Board; J. Nicholas Bayne, President
and Chief Executive Officer; Kurt A. Tornquist, Senior Vice President, Chief
Financial Officer, and Treasurer; Larry E. LaPlante, Vice President, Chief
Accounting Officer, Controller, Clerk, Asst. Treasurer and Asst. Secretary;
Michael A. Thibodeau, Vice President, Compliance and Risk Management; Brent M.
Boyles, Senior Vice President, Operations; William L. Cyr, Vice President,
Engineering and Asset Management; Scott L. Sells, General Counsel, Secretary,
and Assistant Clerk; and John P. Havrilla, Vice President, Business Development
and Unregulated Businesses.</P>
<P>As a result of decisions made in connection with the formation of the holding
company, each director initially will hold a position on the Board of Directors
of both MPS and Maine &amp; Maritimes Corporation.</P>
<P><B>Dividend</B></P>
<P>During the Maine Public Service Company Board of Directors meeting held on
May 30, 2003, the Board of Directors of MPS declared a regular quarterly
dividend of $.37 per share (annualized rate of $1.48 per share) on the Company's
Common Stock payable July 1, 2003, to shareholders of record as of June 16,
2003.</P>
<P>
<CENTER>
<TABLE class=MsoNormalTable
style="WIDTH: 337.5pt; mso-cellspacing: 1.5pt; mso-padding-alt: 0in 0in 0in 0in"
height=736 cellSpacing=3 cellPadding=0 width=450 border=0>

  <TR style="HEIGHT: 33.75pt; mso-yfti-irow: 0">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 33.75pt"
    colSpan=5>
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER><B>Maine Public Service and Subsidiaries<BR>Condensed Balance
      Sheets</B> (Unaudited)</CENTER></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 1">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    colSpan=5>
      <P class=MsoNormal><I>&nbsp;(Dollars in Thousands)</I></P></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 2">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    colSpan=2 rowSpan=2></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    colSpan=3>
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER>&nbsp;<B> May 31,</B></CENTER></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 3">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="19%">
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER>&nbsp;<B>2003</B></CENTER></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="19%">
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER><B>2002</B></CENTER></TD></TR>
  <TR style="HEIGHT: 0.25in; mso-yfti-irow: 4">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 0.25in"
    colSpan=5>
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER><B>&nbsp;Assets</B></CENTER></TD></TR>
  <TR style="HEIGHT: 32.25pt; mso-yfti-irow: 5">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 52%; PADDING-TOP: 0in; HEIGHT: 32.25pt"
    width="52%">
      <P class=MsoNormal>&nbsp;Net Utility Plant &amp; Investments</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 32.25pt"
    width="5%">
      <P class=MsoNormal>&nbsp;</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 32.25pt"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>$53,016</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 32.25pt"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 32.25pt"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>$50,649</P></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 6">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="52%">
      <P class=MsoNormal>Current Asset</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>9,975</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>14,557</P></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 7">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="52%">
      <P class=MsoNormal>Regulatory Assets</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>66,282</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>67,421</P></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 8">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="52%">
      <P class=MsoNormal>Other</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>3,838</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>7,522</P></TD></TR>
  <TR style="HEIGHT: 17.25pt; mso-yfti-irow: 9">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 52%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="52%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>&nbsp;$133,111</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 17.25pt"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>$140,149</P></TD></TR>
  <TR style="HEIGHT: 13.8pt; mso-yfti-irow: 10">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 13.8pt"
    colSpan=5 rowSpan=2>
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER>&nbsp; <B>Capitalization and Liabilities</B></CENTER></TD></TR>
  <TR style="HEIGHT: 13.8pt; mso-yfti-irow: 11"></TR>
  <TR style="HEIGHT: 32.25pt; mso-yfti-irow: 12">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 52%; PADDING-TOP: 0in; HEIGHT: 32.25pt"
    width="52%">
      <P class=MsoNormal>Total Common Equity</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 32.25pt"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 32.25pt"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>$47,516</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 32.25pt"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 32.25pt"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>$43,818</P></TD></TR>
  <TR style="HEIGHT: 0.25in; mso-yfti-irow: 13">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 52%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="52%">
      <P class=MsoNormal>Long-Term Debt</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>30,680</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>31,965</P></TD></TR>
  <TR style="HEIGHT: 32.25pt; mso-yfti-irow: 14">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 52%; PADDING-TOP: 0in; HEIGHT: 32.25pt"
    width="52%">
      <P class=MsoNormal>Total Capitalization</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 32.25pt"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 32.25pt"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>78,196</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 32.25pt"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 32.25pt"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>75,783</P></TD></TR>
  <TR style="HEIGHT: 0.25in; mso-yfti-irow: 15">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 52%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="52%">
      <P class=MsoNormal>Current Liabilities</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>7,474</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>15,414</P></TD></TR>
  <TR style="HEIGHT: 0.5in; mso-yfti-irow: 16">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 52%; PADDING-TOP: 0in; HEIGHT: 0.5in"
    width="52%">
      <P class=MsoNormal>Maine Yankee Decommissioning</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 0.5in"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 0.5in"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>20,943</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 0.5in"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 0.5in"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>21,676</P></TD></TR>
  <TR style="HEIGHT: 0.25in; mso-yfti-irow: 17">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 52%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="52%">
      <P class=MsoNormal>Deferred Credits and Income Taxes</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>26,291</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>25,270</P></TD></TR>
  <TR style="HEIGHT: 0.25in; mso-yfti-irow: 18">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 52%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="52%">
      <P class=MsoNormal>Gain on Asset Sale</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>-</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>1,942</P></TD></TR>
  <TR style="HEIGHT: 0.25in; mso-yfti-irow: 19">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 52%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="52%">
      <P class=MsoNormal>&nbsp;Other</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>207</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>64</P></TD></TR>
  <TR style="HEIGHT: 0.25in; mso-yfti-irow: 20; mso-yfti-lastrow: yes">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 52%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="52%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>$133,111</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 5%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 19%; PADDING-TOP: 0in; HEIGHT: 0.25in"
    width="19%">
      <P style="TEXT-ALIGN: right" align=right>$140,149</P></TD></TR></TABLE></CENTER>
<P></P>
<P>&nbsp;</P>
<P>
<CENTER>
<TABLE class=MsoNormalTable
style="WIDTH: 337.5pt; mso-cellspacing: 1.5pt; mso-padding-alt: 0in 0in 0in 0in"
cellSpacing=3 cellPadding=0 width=450 border=0>

  <TR style="mso-yfti-irow: 0">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in"
    colSpan=4>
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER><B>&nbsp;Maine Public Service and Subsidiaries<BR>Condensed
      Consolidated Income Statements</B> (Unaudited)</CENTER></TD></TR>
  <TR style="mso-yfti-irow: 1">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 61.4%; PADDING-TOP: 0in"
    width="61%">
      <P class=MsoNormal>&nbsp;</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in"
    colSpan=3>
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER>&nbsp; &nbsp;<B>Five Months Ended</B></CENTER></TD></TR>
  <TR style="mso-yfti-irow: 2">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in"
    width="61%">
      <P class=MsoNormal><I>(Dollars in Thousands<BR>Except Per Share
      Amounts)</I></P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in"
    colSpan=3>
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER>&nbsp; &nbsp;<B>May 31,</B></CENTER></TD></TR>
  <TR style="mso-yfti-irow: 3">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 61.4%; PADDING-TOP: 0in"
    width="61%">
      <P class=MsoNormal>&nbsp;</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 14.58%; PADDING-TOP: 0in"
    width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER><B>2003</B></CENTER></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.58%; PADDING-TOP: 0in"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 18.22%; PADDING-TOP: 0in"
    width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: center">
      <CENTER><B>2002</B></CENTER></TD></TR>
  <TR style="mso-yfti-irow: 4">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 61.4%; PADDING-TOP: 0in"
    width="61%">
      <P class=MsoNormal>&nbsp;Operating Revenues</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 14.58%; PADDING-TOP: 0in"
    width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>$16,754</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.58%; PADDING-TOP: 0in"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 18.22%; PADDING-TOP: 0in"
    width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>$16,805</P></TD></TR>
  <TR style="HEIGHT: 3pt; mso-yfti-irow: 5">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 61.4%; PADDING-TOP: 0in; HEIGHT: 3pt"
    width="61%">
      <P class=MsoNormal>&nbsp;</P>
      <P class=MsoNormal>Operating Expenses </P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 14.58%; PADDING-TOP: 0in; HEIGHT: 3pt"
    width="17%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.58%; PADDING-TOP: 0in; HEIGHT: 3pt"
    width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 18.22%; PADDING-TOP: 0in; HEIGHT: 3pt"
    width="17%"></TD></TR>
  <TR style="mso-yfti-irow: 6">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 61.4%; PADDING-TOP: 0in"
    vAlign=bottom width="61%">
      <P class=MsoNormal style="MARGIN-LEFT: 16.6pt">Energy Supply</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 14.58%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>2,421</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.58%; PADDING-TOP: 0in"
    vAlign=bottom width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 18.22%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>2,063</P></TD></TR>
  <TR style="mso-yfti-irow: 7">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 61.4%; PADDING-TOP: 0in"
    vAlign=bottom width="61%">
      <P class=MsoNormal style="MARGIN-LEFT: 16.6pt">T&amp;D Operation and
      Maintenance</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 14.58%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>5,410</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.58%; PADDING-TOP: 0in"
    vAlign=bottom width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 18.22%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>5,304</P></TD></TR>
  <TR style="mso-yfti-irow: 8">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 61.4%; PADDING-TOP: 0in"
    width="61%">
      <P class=MsoNormal style="MARGIN-LEFT: 16.6pt">Depreciation and
      Amortization</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 14.58%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>1,194</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.58%; PADDING-TOP: 0in"
    vAlign=bottom width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 18.22%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>1,190</P></TD></TR>
  <TR style="mso-yfti-irow: 9">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 61.4%; PADDING-TOP: 0in"
    width="61%">
      <P class=MsoNormal style="MARGIN-LEFT: 16.6pt">Amortization of Stranded
      Costs</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 14.58%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>3,918</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.58%; PADDING-TOP: 0in"
    vAlign=bottom width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 18.22%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>3,930</P></TD></TR>
  <TR style="mso-yfti-irow: 10">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 61.4%; PADDING-TOP: 0in"
    width="61%">
      <P class=MsoNormal style="MARGIN-LEFT: 16.6pt">Federal, State, Local, and
      Other Taxes</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 14.58%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>1,613</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.58%; PADDING-TOP: 0in"
    vAlign=bottom width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 18.22%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>2,032</P></TD></TR>
  <TR style="mso-yfti-irow: 11">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 61.4%; PADDING-TOP: 0in"
    width="61%">
      <P class=MsoNormal>&nbsp;</P>
      <P class=MsoNormal>Operating Income </P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 14.58%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right"
align=right>&nbsp;2,198</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.58%; PADDING-TOP: 0in"
    vAlign=bottom width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 18.22%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>2,286</P></TD></TR>
  <TR style="mso-yfti-irow: 12">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 61.4%; PADDING-TOP: 0in"
    width="61%">
      <P class=MsoNormal style="MARGIN-LEFT: 16.6pt">Other Income</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 14.58%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>(490)</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.58%; PADDING-TOP: 0in"
    vAlign=bottom width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 18.22%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>135</P></TD></TR>
  <TR style="mso-yfti-irow: 13">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 61.4%; PADDING-TOP: 0in"
    width="61%">
      <P class=MsoNormal>&nbsp;</P>
      <P class=MsoNormal>Income Before Interest Charges </P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 14.58%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right"
align=right>&nbsp;1,708</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.58%; PADDING-TOP: 0in"
    vAlign=bottom width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 18.22%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>2,421</P></TD></TR>
  <TR style="mso-yfti-irow: 14">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 61.4%; PADDING-TOP: 0in"
    width="61%">
      <P class=MsoNormal style="MARGIN-LEFT: 16.6pt">Interest Charges</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 14.58%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>68&nbsp;</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.58%; PADDING-TOP: 0in"
    vAlign=bottom width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 18.22%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right"
  align=right>&nbsp;239</P></TD></TR>
  <TR style="mso-yfti-irow: 15">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 61.4%; PADDING-TOP: 0in"
    width="61%">
      <P class=MsoNormal>&nbsp;</P>
      <P class=MsoNormal>Net Income Available for Common Stock </P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 14.58%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>$1,640</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.58%; PADDING-TOP: 0in"
    vAlign=bottom width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 18.22%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>$2,182</P></TD></TR>
  <TR style="mso-yfti-irow: 16">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 61.4%; PADDING-TOP: 0in"
    width="61%">
      <P class=MsoNormal>&nbsp;</P>
      <P class=MsoNormal>&nbsp;Earnings Per Share of Common Stock </P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 14.58%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right"
align=right>&nbsp;$1.04</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.58%; PADDING-TOP: 0in"
    vAlign=bottom width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 18.22%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right" align=right>$1.39</P></TD></TR>
  <TR style="mso-yfti-irow: 17; mso-yfti-lastrow: yes">
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 61.4%; PADDING-TOP: 0in"
    width="61%">
      <P class=MsoNormal>&nbsp;</P>
      <P class=MsoNormal>&nbsp;Average Shares Outstanding (000's) </P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 14.58%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right"
align=right>&nbsp;1,574</P></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 3.58%; PADDING-TOP: 0in"
    vAlign=top width="5%"></TD>
    <TD
    style="PADDING-RIGHT: 0in; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; WIDTH: 18.22%; PADDING-TOP: 0in"
    vAlign=bottom width="17%">
      <P class=MsoNormal style="TEXT-ALIGN: right"
  align=right>1,574</P></TD></TR></TABLE></CENTER>
<P></P>
<P class=MsoNormal
style="MARGIN-BOTTOM: 12pt; TEXT-ALIGN: center">&nbsp;<B>Earnings</B></P>
<P>Maine Public Service Company's earnings per share for the five months ended
May 31, 2003, were $1.04 per share based upon net income of $1,640,000 and
1,574,000 average shares outstanding. For the same period in 2002, the earnings
per share were $1.39 per share, based upon net income of $2,182,000 and
1,574,000 average shares outstanding. Earnings based on the performance of EA
decreased by $.08 per share to $ .01 per share, compared to $.09 per share for
the first five months of 2002. As previously reported in filings with the
Securities and Exchange Commission ("SEC"), EA provided SOS within CMP's service
area until February 28, 2002, when the term of EA's SOS contract expired, and
the SOS arrangement was re-bid and awarded to another competitive bidder.</P>
<P>During 2003, anticipated expenses associated with seeking various regulatory
approvals and incremental organization costs associated with the formation of
the new holding company reduced earnings by $.24 per share. As mentioned in the
"Stockholders Approve Holding Company" section of this newsletter, the formation
of Maine &amp; Maritimes Corporation was approved by the stockholders at the May
30, 2003 Annual Meeting; MAM commenced operations on July 1, 2003.</P>
<P>Core transmission and distribution ("T&amp;D") earnings for Maine Public
Service Company decreased by $.03 per share from $1.30 per share for the first
five months of 2002, compared to $1.27 for the same period in 2003. In the first
quarter of 2002, pursuant to a stranded cost rate order from the Maine Public
Utilities Commission, a portion of a refund for nuclear liability insurance for
Maine Yankee was recognized, representing $.06 per share. Offsetting this
decrease in 2003 earnings compared to 2002 was an increase in normal operating
earnings of $.03 per share. Decreases in salaries and benefits, principally as a
result of the voluntary early retirement program that was initiated in December
of 2002, reductions in interest expenses due to lower short-term interest rates
on our variable rate debt, an increase in the carrying charges on stranded
costs, and an increase in retail sales of 2.3% primarily due the recent colder
than normal winter were partially offset by a reduction in operating revenues,
principally wheeling revenues; and an increase in legal, consulting, and
regulatory expenses associated with rate filings at the MPUC and FERC and
corporate governance in response to the requirements of the Sarbanes-Oxley Act
of 2002.</P>
<P>Sincerely,</P>
<P>/s/ J. Nicholas Bayne</P>
<P>J. Nicholas Bayne<BR>President and CEO</P>
<P>&nbsp;</P>
<P>Questions Should Be Directed To:</P>
<P>Annette N. Arribas<BR>Director of Investor Relations<BR>Maine &amp; Maritimes
Corporation<BR>PO Box 789<BR>Presque Isle, ME 04769-0789<BR>Toll-free in US
&amp; Canada: (877) 272-1523<BR>E-Mail:
aarribas@maineandmaritimes.com<BR>http://www.maineandmaritimes.com<BR>AMEX
Ticker Symbol: MAM</P>
<P>The unaudited consolidated Balance Sheets, Income Statements, and the
information presented in this newsletter should be read in conjunction with the
2002 MPS Annual Report, an integral part of the 2002 MPS Form 10-K, and the MPS
Form 10-Q filed for the quarter ended March 31, 2003. The Company's significant
accounting policies, which are the same as those of MPS, are described in the
Notes to Consolidated Financial Statements of the MPS Annual Report filed with
the MPS Form 10-K. For interim reporting purposes, these same accounting
policies are followed.</P>
<P><B>Cautionary Statement Regarding Forward-Looking Information:</B></P>
<P>NOTE: This presentation contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities and Exchange Act of 1934, as amended. Although Maine &amp; Maritimes
Corporation (MAM) believes that in making such statements, its expectations are
based on reasonable assumptions, any such statement involves uncertainties and
risks. MAM cautions that there are certain factors that can cause actual results
to differ materially from the forward-looking information that has been
provided. The reader is cautioned not to put undue reliance on this
forward-looking information, which is not a guarantee of future performance and
is subject to a number of uncertainties and other factors, many of which are
outside the control of MAM; accordingly, there can be no assurance that such
indicated results or events will be realized.</P>
<P>The information herein is qualified in its entirety by reference to factors
contained in the Forward-Looking Statement of the Management's Discussion and
Analysis of Financial Condition and Results of Operation in Maine Public Service
Company's 10-K for the year ended December 31, 2002, and subsequent securities
filings, as well as, but not necessarily limited to the following factors: the
impact of recent and future federal and state regulatory changes in
environmental and other laws and regulations to which MAM and its subsidiaries
are subject, as well as changes in application of existing laws and regulations;
current and future litigation; interest rates; general economic conditions; the
performance of projects undertaken by unregulated businesses; the success of
efforts to invest in and develop new opportunities; internal restructuring or
other restructuring options that may be pursued by MAM or its subsidiaries,
including acquisitions or dispositions of assets or businesses, which cannot be
assured to be completed or beneficial to MAM or its subsidiaries; financial
market conditions; the effects of terrorist incidents; weather; the timing and
acceptance of new product and service offerings; general industry trends;
changes in business strategy and development plans; capital market conditions
and the ability to raise capital; competition; and rating agency actions, among
others. </P></BODY></HTML>
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities and Exchange Act of 1934
Date of Report: July 2, 2003
Date of earliest event reported: June 30, 2003
MAINE PUBLIC SERVICE COMPANY
(Exact name of registrant as specified in its charter)
Maine
(State or other jurisdiction of
incorporation or organization)
1-3429
(Commission File No.)
01-0113635
(I.R.S. Employer Identification No.)
209 State Street, Presque Isle, Maine 04769
(Address of principal executive offices) (Zip Code)
Registrant's telephone number: 207-768-5811
Maine Public Service Company
Item 5. Other Events.
Maine Public Service Company Reorganizes Into Holding Company,
and Changes
Ticker Symbol on AMEX and Reports Five-Month Earnings
As outlined in the Interim Report to Stockholders, dated July, 1, 2003, and
attached hereto as Exhibit 99.1, the reorganization of Maine Public Service
Company into a holding company, Maine & Maritimes Corporation, became
effective on June 30, 2003. As a result of the reorganization, Maine Public
Service Company shares of common stock, formerly traded under the ticker symbol
"MAP," are no longer publicly traded, but were automatically converted to Maine
& Maritimes Corporation shares on a one-to-one basis. Maine & Maritimes
Corporation shares are now traded on the American Stock Exchange under the
ticker symbol "MAM."
The Interim Report also contains unaudited Financial Statements for the
five-month period ended May 31, 2003.
SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
MAINE PUBLIC SERVICE COMPANY
Date: July 2, 2003
By: /s/ J. Nicholas Bayne
J. Nicholas Bayne, President
Exhibit 99.1
Maine & Maritimes Corporation
Interim Report to Stockholders
July 1, 2003
This Interim Report to Stockholders presents consolidated financial results
for Maine & Maritimes Corporation's subsidiary, Maine Public Service Company
("MPS"), and its subsidiaries, Energy Atlantic, LLC ("EA") and Maine and New
Brunswick Electrical Power Company, Limited, through the five months ended May
31, 2003. Energy Atlantic is scheduled to become a subsidiary of Maine &
Maritimes Corporation during July, 2003.
Stockholders Approve Holding Company
During MPS's Annual Meeting of Shareholders, held on May 30, 2003,
stockholders voted overwhelmingly to approve its plan to create a holding
company structure, under the corporate name of Maine & Maritimes Corporation
("MAM" or the "Company"). Of the shares eligible to vote, 57.07% voted "FOR" the
holding company proposal, and 10.19% voted "AGAINST." The reorganization into a
holding company structure became effective on June 30, 2003. No change in
beneficial ownership resulted from the reorganization, which is described in
more detail in the Form S-4/A of Maine & Maritimes Corporation, filed with
the Securities and Exchange Commission on April 15, 2003.
Maine Public Service Company is now a separate subsidiary of Maine &
Maritimes Corporation. Energy Atlantic, LLC, an unregulated Competitive
Electricity Supply company and Maine and New Brunswick Electrical Power Company,
Limited, which is an inactive Canadian company, are subsidiaries of MPS. During
the month of July, 2003, Energy Atlantic, LLC, will become a subsidiary of the
new holding company, Maine & Maritimes Corporation.
Conversion to a holding company structure is part of the Company's overall
strategy to create long-term value and ensure market-competitive dividend
yields. Through the implementation of a holding company structure, your Board of
Directors and management remain committed to a fiscally conservative growth
strategy to hedge the impacts of deregulation and generation divestiture, as
well as the declining-to-static economy of MPS's northern Maine service area.
Our portfolio approach to growth provides for an increased ability to monetize
prudent market opportunities, while enabling increased strategy and enterprise
risk management.
As a result of reorganization into a holding
      company, Maine Public Service Company shares, formerly traded under the
      Ticker Symbol "MAP," are no longer publicly traded. Maine & Maritimes
      Corporation shares are now traded on the American Stock Exchange under the
      Ticker Symbol "MAM."
Shares of MPS Common Stock have been automatically converted into the same
number of shares of Common Stock of MAM. No exchange of certificates is
necessary. However, if you wish, a new certificate can be issued. To obtain a
new certificate, please write or call our Transfer Agent:
The Bank of New York
Shareholder Relations Dept. - 11E
PO Box
11258
Church Street Station
New York, NY 10286
Phone:
1-800-524-4458
E-Mail: Shareownersvcs@bankofny.com
For additional information, please visit our new web site at: http://www.maineandmaritimes.com/.
 In an effort to keep stockholders and potential investors better informed,
we are expanding and enhancing our investor relations Internet presence. The
2002 Annual Report for Maine Public Service Company, Maine & Maritimes
Corporation S-4/A Prospectus, President's Annual Meeting Report to Shareholders,
webcast from the American Stock Exchange, as well as our expanded corporate
governance provisions can now be viewed online.
Highlights
Five Months Ended May 31,
(Dollars in Thousands Except Per Share
      Amounts)
2003
2002
MWH
Dollars
MWH
Dollars
Revenues:
Maine Public Service
- Retail
231,294
$13,768
225,987
$13,170
- Other
-
57
-
750
Energy Atlantic
- Competitive Energy Supplier
53,660
2,929
66,121
2,474
- Standard Offer Margin
-
-
629,193
411
Total Revenues
284,954
$16,754
921,301
$16,805
Net Income Available for Common Stock
$1,640
$2,182
Core T&D
1.27
1.30
Holding Company
(0.24)
-
Energy Atlantic
0.01
0.09
Earnings Per Share
$1.04
$1.39
Business Activity Update
During the reporting period, a number of additional key business activities
have been undertaken to maintain and increase overall stockholder value.
Significant efforts are underway to control overall operating costs of MPS,
while seeking to increase revenues through prudent rate increases and economic
development. While we remain committed to ensuring the utmost in competitiveness
and financial strength of MPS, we have begun aggressive efforts to execute our
overall growth strategy for Maine & Maritimes Corporation. These efforts
involve careful evaluation of market opportunities within those business areas
previously defined and more fully described during our webcast from the American
Stock Exchange and in the MPS 2002 Annual Report. As previously noted, these
items may be viewed on our web site. Given current market conditions, we are
encouraged by the number of economic opportunities within those target sectors
identified by the Company. All opportunities that the Company may wish to pursue
are being scrutinized on a conservative basis, reflecting our continuing
commitment to a fiscally conservative approach to business.
Maine
Public Service
Developed and filed an Alternative Rate Plan (ARP) - MPUC Docket No.
2003-85. On March 6, 2003, following a series of informal meetings with the
Office of Public Advocate and the Maine Public Utilities Commission ("MPUC"),
MPS submitted its formal Request for Approval of an Alternate Rate Plan ("ARP").
The proposal is a seven-year distribution rate plan with a target for
implementation on or before July 1, 2003. The ARP is an alternative form of
regulating MPS's distribution assets allowing for an increased correlation
between performance and allowable return on equity. The ARP has numerous
components, all of which have been designed to fit together as an integrated
whole that will allow MPS to continue to meet the unique needs of its northern
Maine customers, while protecting stockholder interests. Its key proposed
components include: an inflation index and productivity offset; an adjustment
for the treatment of extraordinary costs MPS may incur; an interest expense
adjustment; an economic conditions adjustment; a shareholder earnings sharing
mechanism; pricing flexibility; reliability safety and service quality indices;
and a sharing mechanism for non-core revenues. The proposed structure, if
approved, provides potential earnings upside for stockholders, subject to MPS's
achievement of specific customer-centric service quality indices. A proposed
distribution rate increase of 8.9% has also been requested. At this time, MPS
cannot predict the nature or the outcome of any decision or ruling by the MPUC
in this proceeding.
2003 Open Access Transmission Tariff ("OATT") Filing. MPS received
final agreement from the Federal Energy Regulatory Commission ("FERC") on its
2002 OATT in March 2003. MPS has begun negotiations with FERC and intervenors in
conjunction with its annual 2003 OATT Formula Rate filing. The initial
notification for the 2003 OATT filing was filed with FERC on March 31, 2003. In
its 2003 OATT filing, MPS has provided the proposed changes to its OATT Formula
Rate to the intervening parties and FERC staff. MPS believes that the Formula
Rate continues to produce reasonable results; however, it is recommending minor
modifications. MPS is hopeful it will reach agreement with the parties on the
OATT Formula Rate prior to June 30, 2003. If MPS, the intervenors, and FERC
staff are unable to reach a stipulated agreement, the matter may be submitted to
FERC for a formal proceeding. MPS expects that its overall transmission rate
will increase. MPS cannot predict the exact outcome or timing of any decision or
ruling by FERC regarding this filing.
Implementation of Integrated Asset Management ("IAM") Program. In order to
control capital expenditures, control operating costs, and improve service
reliability, MPS is implementing a unique approach to asset management and
resource-centered maintenance. As a part of the migration to IAM, MPS's Power
Delivery group has been further divided into two different groups: (1) Field
Services and Engineering and (2) Asset Management. Under this organizational
model, Field Services is responsible for service delivery, while Engineering and
Asset Management are responsible for optimizing all transmission and
distribution assets. The overall program involves a new emphasis on
"in-sourcing" vegetation management and transmission construction, while
decentralizing crews to reduce "windshield time" and increase response time.
Additionally, a unique Field Inspection and Quality Control team is being
established to provide ongoing information concerning asset conditions, forming
an improved foundation for deployment of maintenance dollars, and overall system
planning. Unlike those asset management programs focused primarily on
"out-sourcing," MPS's approach ensures that its crews remain employed and
productive, and that it has the number of crews essential for handling emergency
outage situations. In-sourcing and new ways to increase the efficient operation
of a transmission and distribution utility are part of a long-term partnering
commitment between MPS's management and labor. These initiatives include an
"adopt a circuit" program, wherein specific crews become responsible for the
reliability of a specific portion of the MPS system, aligning incentives with
performance.
Increased Commitment to Economic Development. MPS is undertaking
significant steps to enhance its economic development efforts in support of load
growth and overall enhancement of the service area by (a) initiating the
creation of a new regional public-private initiative, and (b) increasing the
area's focus on existing business retention and business recruitment. Building
on the new sense of cooperation and collaboration between the private and public
sectors, MPS is partnering with the Northern Maine Development Commission to
implement highly targeted and results-oriented initiatives. While MPS is highly
focused on cost containment and enhanced productivity, economic development is
the primary means for increasing total revenues of the utility.
Energy Atlantic
EA continues to evaluate southern and central Maine, as well as other New
England unregulated retail electricity markets concerning the market viability
for non-generation-owning Competitive Electricity Suppliers. Management of EA
believes that the ongoing decline of the wholesale electricity trading industry
will continue to make it extremely difficult to find wholesale suppliers with
reasonable credit and mark-to-market risk expectations. Given our desire to not
accept exposure to electricity commodity risks, EA has not found a wholesale
partner to allow its expanded retail marketing efforts within southern and
central Maine, as well as other New England markets with acceptable risk
profiles.
As previously stated, the expiration of EA's sales of Standard Offer Service
("SOS") in Central Maine Power Company's ("CMP's") service territory will
continue to adversely impact EA's revenues and net income and, correspondingly,
earnings. In 2002, EA realized a SOS margin in CMP's service territory of
approximately $5.8 million. The Company continues to review EA's current and
future business model, which may include a possible exit from the Competitive
Electricity Supply (CES) market. On February 24, 2003, EA announced its intent
to withdraw from serving new retail electricity markets in northern Maine due to
concerns over a lack of wholesale market liquidity and profitability in that
market. EA will continue to serve its existing customer contracts in northern
Maine until they expire in February, 2004. The Company will continue to evaluate
EA's participation in the CES market by assessing, among other things, EA's
ability to establish wholesale supply on a conservative and prudent credit and
risk basis.
Election of Directors and Officers
During the Maine Public Service Company Annual Stockholders Meeting, held on
May 30, 2003, its stockholders elected the following Class I Directors for terms
expiring in 2006: Robert E. Anderson (for re-election), Michael W. Caron (for
election), and Nathan L. Grass (for re-election). David N. Felch (for
re-election from Board appointment) was elected as a Class II Director, with a
term expiring in 2004. Mr. Caron and Mr. Felch have been assigned to the Pension
and Benefits Committee and the Audit Committee, strengthening the level of
financial expertise of both Board committees. Mr. Grass is Chairperson of the
Performance and Compensation Committee and is a member of the Corporate
Governance and Strategic Planning Committees. Mr. Anderson is Chairperson of the
Pension and Benefits Committee and is a member of the Strategic Planning
Committee.
Also on May 30, 2003, in MPS's Board of Directors meeting, its Directors
elected officers to serve until the next annual election of officers and until
their successors have been duly chosen and qualified. Those elected are as
follows: G. Melvin Hovey, Chairman of the Board; J. Nicholas Bayne, President
and Chief Executive Officer; Kurt A. Tornquist, Senior Vice President, Chief
Financial Officer, and Treasurer; Larry E. LaPlante, Vice President, Chief
Accounting Officer, Controller, Clerk, Asst. Treasurer and Asst. Secretary;
Michael A. Thibodeau, Vice President, Compliance and Risk Management; Brent M.
Boyles, Senior Vice President, Operations; William L. Cyr, Vice President,
Engineering and Asset Management; Scott L. Sells, General Counsel, Secretary,
and Assistant Clerk; and John P. Havrilla, Vice President, Business Development
and Unregulated Businesses.
As a result of decisions made in connection with the formation of the holding
company, each director initially will hold a position on the Board of Directors
of both MPS and Maine & Maritimes Corporation.
Dividend
During the Maine Public Service Company Board of Directors meeting held on
May 30, 2003, the Board of Directors of MPS declared a regular quarterly
dividend of $.37 per share (annualized rate of $1.48 per share) on the Company's
Common Stock payable July 1, 2003, to shareholders of record as of June 16,
2003.
Maine Public Service and Subsidiaries
Condensed Balance
      Sheets
(Unaudited)
(Dollars in Thousands)
May 31,
2003
2002
Assets
Net Utility Plant & Investments
$53,016
$50,649
Current Asset
9,975
14,557
Regulatory Assets
66,282
67,421
Other
3,838
7,522
$133,111
$140,149
Capitalization and Liabilities
Total Common Equity
$47,516
$43,818
Long-Term Debt
30,680
31,965
Total Capitalization
78,196
75,783
Current Liabilities
7,474
15,414
Maine Yankee Decommissioning
20,943
21,676
Deferred Credits and Income Taxes
26,291
25,270
Gain on Asset Sale
-
1,942
Other
207
64
$133,111
$140,149
Maine Public Service and Subsidiaries
Condensed
      Consolidated Income Statements
(Unaudited)
Five Months Ended
(Dollars in Thousands
Except Per Share
      Amounts)
May 31,
2003
2002
Operating Revenues
$16,754
$16,805
Operating Expenses
Energy Supply
2,421
2,063
T&D Operation and
      Maintenance
5,410
5,304
Depreciation and
      Amortization
1,194
1,190
Amortization of Stranded
      Costs
3,918
3,930
Federal, State, Local, and
      Other Taxes
1,613
2,032
Operating Income
2,198
2,286
Other Income
(490)
135
Income Before Interest Charges
1,708
2,421
Interest Charges
68
239
Net Income Available for Common Stock
$1,640
$2,182
Earnings Per Share of Common Stock
$1.04
$1.39
Average Shares Outstanding (000's)
1,574
1,574
Earnings
Maine Public Service Company's earnings per share for the five months ended
May 31, 2003, were $1.04 per share based upon net income of $1,640,000 and
1,574,000 average shares outstanding. For the same period in 2002, the earnings
per share were $1.39 per share, based upon net income of $2,182,000 and
1,574,000 average shares outstanding. Earnings based on the performance of EA
decreased by $.08 per share to $ .01 per share, compared to $.09 per share for
the first five months of 2002. As previously reported in filings with the
Securities and Exchange Commission ("SEC"), EA provided SOS within CMP's service
area until February 28, 2002, when the term of EA's SOS contract expired, and
the SOS arrangement was re-bid and awarded to another competitive bidder.
During 2003, anticipated expenses associated with seeking various regulatory
approvals and incremental organization costs associated with the formation of
the new holding company reduced earnings by $.24 per share. As mentioned in the
"Stockholders Approve Holding Company" section of this newsletter, the formation
of Maine & Maritimes Corporation was approved by the stockholders at the May
30, 2003 Annual Meeting; MAM commenced operations on July 1, 2003.
Core transmission and distribution ("T&D") earnings for Maine Public
Service Company decreased by $.03 per share from $1.30 per share for the first
five months of 2002, compared to $1.27 for the same period in 2003. In the first
quarter of 2002, pursuant to a stranded cost rate order from the Maine Public
Utilities Commission, a portion of a refund for nuclear liability insurance for
Maine Yankee was recognized, representing $.06 per share. Offsetting this
decrease in 2003 earnings compared to 2002 was an increase in normal operating
earnings of $.03 per share. Decreases in salaries and benefits, principally as a
result of the voluntary early retirement program that was initiated in December
of 2002, reductions in interest expenses due to lower short-term interest rates
on our variable rate debt, an increase in the carrying charges on stranded
costs, and an increase in retail sales of 2.3% primarily due the recent colder
than normal winter were partially offset by a reduction in operating revenues,
principally wheeling revenues; and an increase in legal, consulting, and
regulatory expenses associated with rate filings at the MPUC and FERC and
corporate governance in response to the requirements of the Sarbanes-Oxley Act
of 2002.
Sincerely,
/s/ J. Nicholas Bayne
J. Nicholas Bayne
President and CEO
Questions Should Be Directed To:
Annette N. Arribas
Director of Investor Relations
Maine & Maritimes
Corporation
PO Box 789
Presque Isle, ME 04769-0789
Toll-free in US
& Canada: (877) 272-1523
E-Mail:
aarribas@maineandmaritimes.com
http://www.maineandmaritimes.com
AMEX
Ticker Symbol: MAM
The unaudited consolidated Balance Sheets, Income Statements, and the
information presented in this newsletter should be read in conjunction with the
2002 MPS Annual Report, an integral part of the 2002 MPS Form 10-K, and the MPS
Form 10-Q filed for the quarter ended March 31, 2003. The Company's significant
accounting policies, which are the same as those of MPS, are described in the
Notes to Consolidated Financial Statements of the MPS Annual Report filed with
the MPS Form 10-K. For interim reporting purposes, these same accounting
policies are followed.
Cautionary Statement Regarding Forward-Looking Information:
NOTE: This presentation contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities and Exchange Act of 1934, as amended. Although Maine & Maritimes
Corporation (MAM) believes that in making such statements, its expectations are
based on reasonable assumptions, any such statement involves uncertainties and
risks. MAM cautions that there are certain factors that can cause actual results
to differ materially from the forward-looking information that has been
provided. The reader is cautioned not to put undue reliance on this
forward-looking information, which is not a guarantee of future performance and
is subject to a number of uncertainties and other factors, many of which are
outside the control of MAM; accordingly, there can be no assurance that such
indicated results or events will be realized.
The information herein is qualified in its entirety by reference to factors
contained in the Forward-Looking Statement of the Management's Discussion and
Analysis of Financial Condition and Results of Operation in Maine Public Service
Company's 10-K for the year ended December 31, 2002, and subsequent securities
filings, as well as, but not necessarily limited to the following factors: the
impact of recent and future federal and state regulatory changes in
environmental and other laws and regulations to which MAM and its subsidiaries
are subject, as well as changes in application of existing laws and regulations;
current and future litigation; interest rates; general economic conditions; the
performance of projects undertaken by unregulated businesses; the success of
efforts to invest in and develop new opportunities; internal restructuring or
other restructuring options that may be pursued by MAM or its subsidiaries,
including acquisitions or dispositions of assets or businesses, which cannot be
assured to be completed or beneficial to MAM or its subsidiaries; financial
market conditions; the effects of terrorist incidents; weather; the timing and
acceptance of new product and service offerings; general industry trends;
changes in business strategy and development plans; capital market conditions
and the ability to raise capital; competition; and rating agency actions, among
others.