Dominion Power 2013 Annual Report Download - page 8

Our total shareholder return — the
combination of one share of common stock’s
price change over a year plus its dividend
payout — ended 2013 at 29.7 percent,
which barely beat that of the Dow Jones
Industrial Average at 29.6 percent and
was slightly less than that of the S&P 500,
which returned 32.4 percent. The total
shareholder return of our peers in the
Philadelphia Stock Exchange Index (UTY)
was 11.0 percent. In 2013, Dominion’s total
return ranked second among that of the
20 utilities that are part of the UTY.
Last year Dominion returned $2.25
per share in dividends to shareholders,
a 6.6 percent increase from 2012. We paid
out 69 percent of operating earnings per
share, within the 65 percent to 70 percent
payout target range set by the company’s
board of directors in December 2012.*
SAFETY METRICS IMPROVE
Our growth opportunities arise from our
base of operations — vibrant communities
and savvy customers requiring state-of-
the-art facilities, wires and pipes that can
move electricity and natural gas seamlessly,
without interruption.
Yet we cannot achieve targeted growth
rates and meet market demand without the
hard work, faithfulness and integrity of our
14,500 employees.
Whenever meeting with investors or
potential investors in our company, I discuss
Dominion’s four core values— safety, ethics,
excellence and One Dominion, our term
for teamwork.
We expect everyone at Dominion
to live these values each and every day.
Indeed, an ethical company whose
employees do their jobs safely and well
not only is a less risky proposition for your
hard-earned money but also bolsters our
relationships with lawmakers, regulators,
customers and other stakeholders.
Safety is the most important value.
We want all employees to return home after
a day on the job without incident. Every
employee must take personal responsibility
for safety to ensure that no one is harmed.
Internally, we call this a drive to zero.
Companywide in 2013, Dominion recorded
all-time bests for OSHA recordable and
“
SAFETY IS THE MOST
IMPORTANT VALUE.
WE WANT ALL EMPLOYEES
TO RETURN HOME AFTER A
DAY ON THE JOB WITHOUT
INCIDENT. EVERY EMPLOYEE
MUST TAKE PERSONAL
RESPONSIBILITY FOR
SAFETY TO ENSURE THAT
NO ONE IS HARMED.
”
10 DOMINION RESOURCES, INC.
* See page 22 for GAAP Reconciliation
of Operating Dividend Payout Ratio
(non-GAAP) to Reported Payout Ratio
(GAAP).
lost time/restricted duty rates, reducing
2012 rates by 10 percent and 6 percent,
respectively. Dominion East Ohio had its best
safety performance in its 115-year history.
And Dominion Virginia Power’s rate of lost-day
incidents and serious injuries dropped to its
lowest-ever level.
This performance, while outstanding,
provides room for improvement in our
drive to zero.
STRATEGIC HIGHLIGHTS
Your company’s attributes include its
desirable location and its dedicated
employees. Achieving desired results also
includes a vision, a path forward — our
multibillion-dollar, energy infrastructure
growth plan.
Our desired results? Customer satisfaction
and service reliability. Earnings-per-share
growth. Dividend increases. Solid returns
for you, our shareholders.
Dominion’s promise is an operating
earnings mix consisting of 80 percent to
90 percent from businesses such as our
electric and gas utilities and our natural gas
interstate pipeline and storage system.
In 2013, 84 percent of your company’s
primary operating segment earnings were
derived from businesses such as those.
Our sale of two merchant coal-fired power
stations and our 50 percent ownership stake
in a gas-fired facility helped us achieve that
goal. The sale reduced commodity risk,
and the company will use the proceeds —
about $650 million after taxes, including
cash tax benefits from the sale — to
finance further growth in our regulated
and contracted enterprises.
In 2013, your company also took steps to
provide more transparency and clarity in our
regulated gas businesses—gas transmission
pipeline and storage assets and natural
gas distribution companies— by creating
Dominion Gas Holdings, LLC, a subsidiary
that, like Virginia Power, will have the ability
to issue debt to finance maintenance and
growth. Because the new entity will be filing
financial information with the U.S. Securities
and Exchange Commission, investors will be
presented a clearer picture of the overall
financial performance of these operations.