Dominion Power 2012 Annual Report Download - page 9

2012SummaryAnnualReport Dominion Resources 11
under normal weather conditions. Had
weather conditions been normal in 2012,
the company’s expected operating earn-
ings growth would have exceeded our
5– 6 percent target.
Our total shareholder return (TSR) —the
combination of one share of common
stock’s price change over a year plus its
dividend payout— ended 2012 at 1.7 per-
cent, significantly below 2011’s return of
29.4 percent. Our returns trailed those
of the major indices— the Dow Jones
Industrial Average, at 10.2 percent, and
the S&P 500, at 16.0 percent. We outper-
formed our designated TSR peer group
in the Philadelphia Stock Exchange Utility
Index (UTY), which lost 0.6 percent.
Dominion’s three- and five-year returns,
however, remain steadily ahead of the
major indices and our peers. Over the past
three years, a share of Dominion stock
has returned 51.1 percent; 35.8 percent
over five years. The S&P 500, which
represents the broader market, returned
36.3 percent and 8.6 percent over three
years and five years, respectively. The
respective three- and five-year yields for
our peers in the UTY were 25.3 percent
and 0.4 percent.
The utility sector in 2012 generally lagged
the overall market as investors feared that
high-dividend-yield stocks, such as those
of utilities, would be affected by unfavor-
able tax policy changes on Capitol Hill.
As 2013 opened, Congress voted to
extend the current dividend tax rate of
15 percent for individuals earning less
than $400,000. For those earning more,
the rate has been increased to 20 percent.
A rally for high-dividend-paying stocks
immediately followed the deal.
Last year Dominion returned $2.11 per
share in dividends to shareholders, a
7.1 percent increase over 2011. We paid
out 69 percent of operating earnings per
share, above the 60– 65 percent payout
target range set by the board in 2010.*
Safety: Always Our Top Priority
Throughout my career I have said many
times, many ways, that keeping the lights
on and the gas flowing is critical to our
nation’s economy, electronic infrastruc-
ture and defense apparatus. But there is
absolutely nothing more important than
doing that job safely, thereby protecting
our employees, our customers and
your investments.
As we tell all employees, remaining
incident-free demands more than merely
attending safety briefings and wearing
the right protective equipment. It is their
personal commitment to ensuring safety
for themselves and those around them.
Although one accident in which an
employee is injured is one too many, in
2012 we continued our downward trend
toward zero. The recordable incidence
rate— the number of reported workplace
injuries per 100 employees —dropped to
0.74, a 60 percent decline since 2006.
The lost time/restricted duty incidence
rate—the number of workplace injuries
that resulted in lost workdays or reassign-
ment of duties per 100 employees—fell
to 0.36, a six-year, 62 percent decrease
in LT/RD rates. Both are all-time
company-wide lows.
Growth Plan Moves Forward
Your company’s long-term growth plan
remained on track in 2012, with six
major projects coming online to serve
our customers.
We spent about $2.5 billion in 2012
alone on new and upgraded infrastructure
Building
Tomorrow’s
Workforce
Throughout our businesses, we rely on
craft, engineers, lawyers, accountants,
financial analysts and myriad other
individuals whose skills ensure we make
the best business decisions that support
the services we provide our customers.
We value diversity and want to attract,
hire and retain the best employees.
Part of that effort includes our innovative
Troops to Energy Jobs program,
which has hired 224 military veterans
since 2011.
* See page 22 for GAAP Reconciliation of Operating
Dividend Payout Ratio (non-GAAP) to Reported Payout
Ratio (GAAP).