Xcel Energy 2013 Annual Report Download - page 3

Truste d is the theme of this report and not a word we
use lightly. But whether shareholders trust us with their
investment or customers trust us to meet their 24/7 energy
needs, we work hard all day, every day, to earn that trust. Our
accomplishments in 2013 and our plans for the future prove
that Xcel Energy delivers on its promises, making it a premium
company well-positioned for long-term success. When it
comes to building trust, those are the attributes that matter.
Meeting our financial goals
From a financial perspective, 2013 was another strong year.
We grew ongoing earnings more than 7 percent to $1.95 per
share, signifying the ninth consecutive year we’ve met or
exceeded our earnings guidance and the fourth consecutive
year we’ve delivered earnings in the upper half of our
guidance range.
Each of our four operating companies experienced improved
profitability, in part because we saw constructive rate case
outcomes in several jurisdictions. Positive weather and lower
interest expenses also contributed to good results.
We grew our dividend in 2013 for the 10th consecutive year
and established a new dividend growth objective of 4 percent
to 6 percent. Early in 2014, we actually increased the dividend
by 7 percent, reflecting the confidence
we have in our business plan and our
desire to continue to provide an attractive
dividend yield.
Finally, our balance sheet and credit
metrics are strong, which allow us to
access capital markets at attractive
rates. That’s important because our
success depends in part on the wise
investments we continue to make in our
electric and natural gas businesses. Our
capital forecast over the next five years is
more than $14 billion, which will result in
stronger, more resilient energy systems.
Given a successful 2013 and a promising 2014, we are
reaffirming our earnings guidance of $1.90 to $2.05 per share.
Earning trust through performance
Running our business well is fundamental to the trust we
establish with our stakeholders. In 2013, we demonstrated
many times over that we can successfully complete complex
projects and consistently manage day-to-day operations
efficiently and effectively. We put the best processes and
procedures in place to deliver strong performance and then
measure our results in a variety of ways.
Our transmission business, where we managed
$1 billion of projects in 2013, offers a good example.
Because we’ve developed strong expertise and resources
and work collaboratively with our stakeholders, we only build
transmission projects that truly deliver value for customers,
and we build those projects efficiently. When we benchmark
against others, the average cost of our 345-kilovolt projects
is $1.7 million per mile, compared with a national average of
about $2.1 million.
We also successfully completed the second year of a
four-year effort to replace a natural gas pipeline that forms
the backbone of our northern Colorado delivery system.
XCEL ENERGY’S COMMITMENT TO EXCELLENCE AND THE VALUES
THAT HAVE MADE THIS COMPANY STRONG REMAINED THE FOCUS OF
2013, ANOTHER OUTSTANDING YEAR FOR US. WE MORE THAN MET
OUR FINANCIAL OBJECTIVES, PROVED OUR OPERATIONAL EXCELLENCE
AND POSITIONED OURSELVES TO TAKE ADVANTAGE OF PROMISING
GROWTH OPPORTUNITIES. WE STRENGTHENED OUR STRATEGIC PATH
FORWARD, MADE SIGNIFICANT INVESTMENTS IN THE ENERGY GRID
AND DEMONSTRATED AN ENDURING COMMITMENT TO ENVIRONMENTAL
LEADERSHIP AND THE VITALITY OF THE COMMUNITIES WE SERVE.
MOST IMPORTANT, WE CAME THROUGH FOR CUSTOMERS UNDER
CHALLENGING CIRCUMSTANCES BECAUSE WE HAVE THE BEST
EMPLOYEES IN THE BUSINESS.
DEAR SHAREHOLDERS:
ANNUAL REPORT 2013
XCEL ENERGY
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Ben Fowke,
Chairman, President and CEO