Following a transformational year that saw TransCanada acquire Columbia Pipeline Group and post record-setting financial results, the company's strong performance has continued into this year.
That is the message from President & CEO Russ Girling as TransCanada reported its first quarter results and holds its annual meeting of shareholders in Calgary today.
"2016 was truly a transformational year for TransCanada as our portfolio of high-quality energy infrastructure assets performed very well, while our long-term strategy and financial discipline enabled us to undertake unprecedented growth that will reward our shareholders for years to come," Girling says.
"Today we are advancing a $23 billion near-term capital program that is expected to generate significant growth in earnings and cash flow and support an expected annual dividend growth rate at the upper end of an eight to 10 per cent range through 2020."
The addition of Columbia along with the completion of several other growth projects saw TransCanada's asset base grow to $89 billion. At the same time, the company's share price reached all-time highs and net cash provided by operations exceeded $5 billion for the first time in the company's history. Based on this success, the board of directors approved the company's 17th consecutive annual increase in the common share dividend, amounting to a 10.6 per cent increase in the annualized dividend for 2017.
"We continued to build on those accomplishments in early 2017," Girling says. "Excluding specific items, we generated record first quarter financial results. Comparable earnings per share increased 16 per cent compared to the same period last year primarily due to strong performance across our Natural Gas Pipelines business, while comparable funds generated from operations were $1.5 billion."
Girling says TransCanada continues to be focused on the safe and reliable delivery of the energy that millions of North Americans rely on.
"With the exception of a very small minority of professional activists, people know they need the energy we provide. However, without exception, their expectation is that that energy is delivered safely, and that safety above all else is our top priority," Girling said. "We have a 65-year track record of safe and reliable operations, but we believe all accidents and incidents are preventable, and we are focused on a goal of zero incidents and we will not be satisfied until we achieve it."
The company also continues to pursue $45 billion in longer-term growth projects that will help meet North America's demand for energy in decades to come, which could further augment or extend dividend growth in the future.
Girling said he has been impressed with how the employees of TransCanada and Columbia have come together over the last year to create a stronger and more competitive company and he expects the company's strong performance will continue.
"Seventeen years ago we set our vision to become one of North America's leading energy infrastructure companies and we are well on our way to realizing our vision," he said.
"It is clear that the strategy we put in place in 2000 continues to pay off for our shareholders, as they have been rewarded with growing dividends and an average annual total return of 14 per cent over that period."