The Empire District Electric Company Earnings Report and Declaration of Dividends

JOPLIN, Mo.--(Business Wire)--
At the Board of Directors meeting of The Empire District Electric
Company (NYSE:EDE) held today, the Directors declared a quarterly
dividend of $0.32 per share on common stock payable December 15, 2008,
to holders of record as of December 1, 2008.

The Company, an operator of regulated electric, gas and water
utilities, announced today the results for the quarter and twelve
months ended September 30, 2008.

Highlights

-- The Company reported consolidated earnings for the 2008 third
quarter of $20.2 million, or basic earnings per share of $0.60
and diluted earnings per share of $0.59, compared with 2007
third quarter earnings of $23.3 million, or $0.76 per
share-basic and diluted. Earnings for the twelve months ended
September 30, 2008 were $31.6 million, or $0.95 per share.
This compares to earnings of $41.8 million, or $1.38 per
share, for the 2007 twelve month period.

-- The Missouri Public Service Commission (MPSC) issued an Order
on July 31 authorizing a net increase in electric revenues of
approximately $22.0 million. This represents an approximate
6.7 percent increase to the Company's Missouri rate revenues
and is based on a 10.8% return on equity. The MPSC also
authorized a fuel adjustment clause for the Company's Missouri
customers. The fuel adjustment component of revenues will be
modified twice per year upon MPSC approval. Additionally, the
MPSC approved the recovery of deferred expenses for 2007 ice
storms and continued tracker mechanisms for pension and other
post-retirement benefit expenses. Additionally, the Commission
established a tracker mechanism designed to recover the costs
associated with complying with vegetation control and system
reliability rules implemented this past year.

-0-
*T
THE EMPIRE DISTRICT ELECTRIC COMPANY
SEGMENT FINANCIAL HIGHLIGHTS
(in 000's except per share information, certain segment amounts
exclude eliminations )
----------------------------------------------------------------------
Quarter Ended September 30, 2008
----------------------------------------------------------------------
Electric Gas Other Consolidated
----------------------------------------------------------------------
Revenues $131,395 $6,056 $1,366 $138,685
----------------------------------------------------------------------
Fuel & Purchase Power Exp. 51,501 3,414 -- 54,915
----------------------------------------------------------------------
Other Operating Expenses 51,934 2,935 1,014 55,751
----------------------------------------------------------------------
Operating Income (Loss) 27,960 (293) 352 28,019
----------------------------------------------------------------------
Net Income (Loss) from
Continuing Operations 21,108 (1,234) 306 20,180
----------------------------------------------------------------------
Net Income from
Discontinued Operations -- -- -- --
----------------------------------------------------------------------
Net Income (Loss) $21,108 $(1,234) $306 $20,180
----------------------------------------------------------------------
Earnings Per Weighted-
Average Share,
Basic $0.60
Diluted $0.59
----------------------------------------------------------------------

THE EMPIRE DISTRICT ELECTRIC COMPANY
SEGMENT FINANCIAL HIGHLIGHTS
(in 000's except per share information, certain segment amounts
exclude eliminations )
----------------------------------------------------------------------
Quarter Ended September 30, 2007
----------------------------------------------------------------------
Electric Gas Other Consolidated
----------------------------------------------------------------------
Revenues $135,980 $5,642 $986 $142,487
----------------------------------------------------------------------
Fuel & Purchase Power Exp. 52,402 2,607 -- 55,009
----------------------------------------------------------------------
Other Operating Expenses 52,152 3,073 704 55,808
----------------------------------------------------------------------
Operating Income (Loss) 31,426 (38) 282 31,670
----------------------------------------------------------------------
Net Income (Loss) from
Continuing Operations 24,015 (907) 92 23,200
----------------------------------------------------------------------
Net Income from
Discontinued Operations -- -- 111 111
----------------------------------------------------------------------
Net Income (Loss) $24,015 $(907) $203 23,311
----------------------------------------------------------------------
Earnings Per Weighted-
Average Share,
Basic $0.76
Diluted $0.76
----------------------------------------------------------------------
*T

Third Quarter Electric Results

Electric revenues for the 2008 quarterly results compared to 2007
were lower primarily due to much cooler weather. We estimate the
impact of weather reduced revenues approximately $8.7 million. Other
significant revenue items include rate changes in various
jurisdictions which added approximately $2.8 million and customer
growth (0.5% increase) contributed another $1.3 million. Overall, 2008
quarterly electric revenues decreased $4.6 million which represents a
3.4% decrease compared to the 2007 third quarter.

The third quarter fuel and purchased power expenses were lower by
$0.9 million overall, and were impacted by the transition to a fuel
adjustment mechanism in our Missouri jurisdiction. Actual fuel costs
decreased $8.7 million due to lower natural gas volumes driven by the
milder weather. The decrease in natural gas volumes was partially
offset by increased prices for coal and purchased power totaling $5.2
million. Our fuel expenses were also adjusted upward by $1.8 million
primarily for the Missouri fuel adjustment clause which became
effective September 1, as our actual fuel and purchased power costs
were lower on a kilowatt hour basis compared to the amount allowed in
our base rates.

Other operating and maintenance expenses increased $1.2 million
for the third quarter of 2008 compared to 2007. This increase included
$0.4 million related to amortization of 2007 ice storm costs which
were approved in the recent Missouri rate case. Several other
operating and maintenance categories experienced relatively small
increases compared to 2007 with the exception of lower expenses for
pension and healthcare, and a credit recorded for previously expensed
consulting fees due to a change in regulatory treatment. Depreciation
and other taxes were relatively flat for the quarter compared to the
2007 quarter. In summary, the electric segment net income was $21.1
million for the 2008 quarter compared to $24.0 million for 2007.

Third Quarter Gas Results

Revenues from gas operations for the third quarter of 2008
increased $0.4 million compared to 2007. However, the cost of natural
gas sold and transported also increased approximately $0.8 million
during 2008 compared to 2007. Gas operations and maintenance expenses
increased $0.2 million compared to last year, but were partially
offset by a decrease in income and other taxes. Overall, the quarterly
2008 gas segment results reported a loss of $1.2 million compared to a
loss of $0.9 million for 2007.

Third Quarter Consolidated Results

Total interest charges increased approximately $0.4 million in the
2008 third quarter compared to 2007. Long-term debt interest increased
for the quarter by approximately $1.5 million compared to 2007,
primarily attributable to the issuance of $90 million of First
Mortgage Bonds in May 2008. The increase in long-term debt interest
was partially offset by a reduction in short-term and other interest
expenses of $0.5 million and an increase in AFUDC-debt of $0.6
million. The Company's other income and deductions provided $1.1
million of additional income compared to the 2007 quarter which was
mostly attributable to the equity component of AFUDC.

Twelve Months Ended Electric Results

Electric segment revenues for the twelve months ended September
30, 2008 increased $18.5 million over the same 2007 period. The most
significant factors increasing revenues were related to jurisdictional
rate increases of approximately $11.6 million and off-system revenues
of $8.6 million. An estimated $7.5 million negative impact from
weather was the only significant decrease to revenues.

Electric fuel and purchased power costs for the 2008 twelve month
period increased $33.2 million. We experienced increased natural gas
and purchased power costs since our coal plant availability was lower
in the 2008 twelve month period compared 2007. An increase in volumes
was also utilized to support the increase in off-system sales and
continued customer growth.

Other operating costs increased $2.3 million, but were partially
offset by a reduction in maintenance costs of $2.0 million.
Depreciation increased approximately $4.9 million and other taxes
increased $0.8 million. The 2008 results included the sale of a unit
train which resulted in a gain of $1.2 million, and the 2007 period
included a $0.8 million loss on a plant cost disallowance. Overall,
the electric segment 2008 twelve month period resulted in net income
of $29.0 million compared to $41.2 million for the same 2007 period.

Twelve Months Ended Gas Results

Revenues from gas operations during the 2008 twelve month period
increased $0.4 million over 2007. The cost of natural gas sold and
transported decreased $0.4 million during 2008. Other operating and
maintenance expenses decreased $0.8 million for the 2008 twelve month
period compared to 2007. Depreciation and other taxes were unchanged
for the comparative periods. The gas segment net income was $1.5
million for the 2008 twelve month period compared to $0.5 million for
the 2007 period.

Twelve Months Ended Consolidated Results

Total interest charges increased approximately $2.0 million in the
2008 twelve month period compared to 2007. Interest related to
long-term debt increased $4.6 million but was partially offset by
decreased short-term debt interest of $0.9 million and a $1.8 million
increase related to the debt component of AFUDC . The equity component
of AFUDC also primarily improved our other income and expense category
by $1.4 million when comparing the twelve month periods.

Reconciliation of Earnings Per Share

The following reconciliation of basic earnings per share compares
the quarter and twelve month periods ended September 30, 2008 versus
September 30, 2007 and is a non-GAAP presentation. We believe this
information is useful in understanding the fluctuation in earnings per
share between the prior and current period. The reconciliation
presents the after tax impact of significant items and components of
the statement of operations on a per share basis before the impact of
additional stock issuances. This reconciliation may not be comparable
to other companies or more useful than the GAAP presentation included
in the statements of operations which will be included in our 10-Q
filing.

-0-
*T
Quarter Twelve Months
Ended Ended
------------- -------------
Basic Earnings Per Share - September 30,
2007 $0.76 $1.38
Revenues
Electric segment (0.10) 0.41
Gas segment 0.01 0.01
Other segment 0.01 0.02
Expenses
Electric fuel and purchased power 0.02 (0.73)
Cost of natural gas sold and
transported (0.02) 0.01
Operating - electric segment (0.01) (0.05)
Operating - gas segment (0.01) --
Maintenance and repairs (0.01) 0.06
Depreciation and amortization -- (0.12)
Loss on plant disallowance -- 0.02
Gain on sale of assets -- 0.03
Change in effective income tax rates -- 0.03
Other taxes -- (0.02)
Other income and deductions -- 0.01
Interest charges (0.02) (0.09)
AFUDC 0.03 0.07
Discontinued operations -- (0.01)
Dilutive effect of additional shares (0.06) (0.08)
------------- -------------

Basic Earnings Per Share - September 30,
2008 $0.60 $0.95
============= =============
*T

Earnings Conference Call

Bill Gipson, President and CEO, will host a conference call
Friday, October 24, 2008, at 1:00 p.m. Eastern Time to discuss
earnings for the third quarter and twelve months ended September 30,
2008. To phone in to the conference call, parties in the United States
should dial 1-800-218-8862, any time after 12:45 p.m. Eastern Time.
The presentation can also be accessed from Empire's website at
www.empiredistrict.com. A replay of the call will be available for two
weeks by dialing 1-800-405-2236 and entering passcode 11121116#.
Forward-looking and other material information may be discussed during
the conference call.

Based in Joplin, Missouri, The Empire District Electric Company
(NYSE:EDE) is an investor-owned utility providing electric, natural
gas (through its wholly owned subsidiary The Empire District Gas
Company) and water service, with approximately 215,000 customers in
Missouri, Kansas, Oklahoma, and Arkansas. A subsidiary of the Company
also provides fiber optic services.

Certain matters discussed in this press release are
"forward-looking statements" intended to qualify for the safe harbor
from liability established by the Private Securities Litigation Reform
Act of 1995. Such statements address future plans, objectives,
expectations, and events or conditions concerning various matters.
Actual results in each case could differ materially from those
currently anticipated in such statements, by reason of the factors
noted in our filings with the SEC, including the most recent Form 10-K
and 10-Q.

The Empire District Electric Company
Media Communications
Amy Bass, 417-625-5114
Director of Corporate Communications
abass@empiredistrict.com
or
Investor Relations
Jan Watson, 417-625-5108
Secretary - Treasurer
jwatson@empiredistrict.com

Copyright Business Wire 2008