Vectren 2013 Annual Report Download - page 5

Vectren Corporation 2013 Annual Report & Form 10-K 3
Turning to our Nonutility group, we expect Infrastructure Services to remain the primary driver of
this group’s financial performance in the near-term. Underground construction activity generally is
expected to remain strong as utilities, municipalities and pipeline operators replace their aging natural
gas and oil pipelines and related infrastructure. Additional demand for these services will come from
pipeline operators’ need to install new pipelines for shale gas and oil infrastructure. Our experienced
management team has demonstrated the capability to manage long-term customer relationships and
the ability to provide safe, quality pipeline installation to meet this growing demand. We also remain
optimistic about Energy Services’ ability to become a stronger contributor to earnings growth due to
expected increases in demand for their services. This division will continue to look for opportunities
to gain additional access to the Federal markets whereby we’ll be better positioned to compete for
additional energy efficiency contracts. Furthermore, we expect Energy Services to capitalize on its
extensive experience in developing, constructing and operating distributed generation projects to
meet the rapidly growing demand for sustainable infrastructure.
I believe Vectren continues to be well-positioned for the future. We’re a company founded on
conservative principles and growing earnings; thus, allowing for continued increases in dividend
levels, having now increased dividends paid to shareholders for 54 consecutive years. We have a
solid road map for consistent earnings growth. Our utility business, driven by significant investments
in our natural gas utilities, is poised for 3% growth, and the very favorable long-term pricing outlook
for natural gas will continue to spur a number of opportunities for development, including rural
expansion, combined heat and power projects, fuel conversion and natural gas vehicle adoption. For
the Nonutility group, our continued focus on Infrastructure Services and Energy Services will continue
and should help us achieve, over the long-term, a consistent earnings growth target of 10% annually.
These utility and nonutility growth rates should result in overall earnings growth of 4 to 5% and, when
coupled with the dividend, should provide a total return to shareholders of 8 to 10%.
I am surrounded by an experienced, quality management team that has helped execute our growth
plans while remaining focused on the safety and engagement of our colleagues, as well as the
long-term sustainability of the communities we serve. Even more important is our unwavering
commitment to customer service – in all of our businesses – that drives our daily operations and will
continue to serve as a leading core value as we look to the future. I look forward to the next phase
in the execution of our corporate strategy and know we’ll strive to proactively adapt to the evolving
energy industry model. I hope your investment with Vectren will remain and strengthen as our journey
continues.
Carl L. Chapman
Chairman, President & CEO
February 20, 2014