Fortis Inc. ("Fortis" or the "Corporation") (TSX/NYSE: FTS) today
announced its new five-year capital investment plan of $19.6
billion for the period 2021 to 2025, up $800 million from the prior
year's plan. Consolidated rate base is projected to increase
from $30.2 billion in 2020 to $36.4 billion in 2023 and
$40.3 billion in 2025, translating into three and five-year
compound annual growth rates of 6.5% and 6.0%, respectively.
"With nearly $20 billion of capital planned over
the next five years, our customers will continue to benefit from
the safe, reliable and affordable service we provide," said Barry
Perry, President and CEO, Fortis. "The new five-year plan supports
our investment-grade credit ratings and dividend growth, providing
stability for our shareholders."
The five-year capital plan includes investments
of $5.1 billion at ITC for electric transmission
infrastructure to expand system capacity, improve reliability
through system upgrades and provide customers access to more
cost-effective renewable energy. At FortisBC we expect to invest
$4.4 billion in natural gas and electric infrastructure
including investments to improve gas line safety and integrity, new
natural gas storage to improve resiliency and infrastructure to
serve customer-owned LNG export facilities. At UNS Energy in
Arizona, we expect to invest $3.8 billion in transmission,
distribution and generation infrastructure to support a cleaner
energy future. The capital investment plan is expected to be
primarily funded with cash from operations, debt raised at the
utilities and common equity from the Corporation's dividend
reinvestment plan.
The Corporation continues to monitor current
impacts of the COVID-19 pandemic. Our utilities are keeping the
health and safety of our employees and customers at the forefront
while we deliver essential electricity and natural gas to homes and
businesses across North America. Major capital projects are
progressing as planned and remain on track. Our $4.3 billion
capital expenditure plan for 2020 remains on target and is expected
to grow rate base this year by approximately 8%.
Corporate-Wide Carbon Emissions
Reduction Target Established
Today the Corporation is building on its low
emissions profile by establishing an aggressive corporate-wide
target to reduce carbon emissions by 75% by 2035 from a 2019 base
year. Fortis expects to achieve the target through delivering on
Tucson Electric Power's goal to reduce carbon emissions by exiting
coal generation and adding approximately 2,400 megawatts of
wind and solar power systems and 1,400 megawatts of energy storage
systems. Clean energy initiatives across the Corporation's other
utilities will also contribute to achieving this goal.
"Today we are committing to a sustainable future
with our new emissions reduction target which will provide our
customers and communities with cleaner energy," said Perry. "By
2035, virtually all of the Corporation’s business will be comprised
of energy delivery and renewable, carbon-free generation."
Executing on this carbon emissions reduction
target as well as key industry trends including asset resiliency,
grid modernization and the delivery of cleaner energy are expected
to enhance our organic growth strategy and drive incremental
investments beyond the five-year capital plan giving the
Corporation confidence in its long-term growth profile.
Dividends and Dividend Guidance
The Board declared a common share dividend of
$0.505 per share on the issued and outstanding fully paid common
shares of the Corporation, representing a 5.8% increase in the
quarterly dividend, payable on December 1, 2020 to the common
Shareholders of Record at the close of business on November 18,
2020. In addition, the Corporation has extended its targeted
average annual dividend per common share growth of approximately 6%
to 2025 based on a 2020 annualized dividend of $1.91. Effective
December 1, 2020, the 2% discount offered on common share issuances
under the dividend reinvestment plan will be reinstated.
The continuation of dividend growth guidance is
premised on several assumptions, including the continued good
performance of our utilities, growth in our service territories,
the expectation of reasonable outcomes for regulatory proceedings,
no material impacts of the COVID-19 pandemic and the successful
execution of the Corporation's five-year capital investment
plan.
The Board has declared the following
dividends:
- $0.3063 per share on the First
Preference Shares, Series "F" of the Corporation, payable on
December 1, 2020 to the Shareholders of Record at the close of
business on November 18, 2020;
- $0.2745625 per share on the First
Preference Shares, Series "G" of the Corporation, payable on
December 1, 2020 to the Shareholders of Record at the close of
business on November 18, 2020;
- $0.11469 per share on the First
Preference Shares, Series "H" of the Corporation, payable on
December 1, 2020 to the Shareholders of Record at the close of
business on November 18, 2020;
- $0.100661 per share on the First
Preference Shares, Series "I" of the Corporation, payable on
December 1, 2020 to the Shareholders of Record at the close of
business on November 18, 2020;
- $0.2969 per share on the First
Preference Shares, Series "J" of the Corporation, payable on
December 1, 2020 to the Shareholders of Record at the close of
business on November 18, 2020;
- $0.2455625 per share on the First
Preference Shares, Series "K" of the Corporation, payable on
December 1, 2020 to the Shareholders of Record at the close of
business on November 18, 2020;
- $0.2445625 per share on the First
Preference Shares, Series "M" of the Corporation, payable on
December 1, 2020 to the Shareholders of Record at the close of
business on November 18, 2020; and
- $0.505 per share on the Common
Shares of the Corporation, payable on December 1, 2020 to the
Shareholders of Record at the close of business on
November 18, 2020.
The Corporation has designated the common share
dividend and preference share dividends as eligible dividends for
federal and provincial dividend tax credit purposes.
About FortisFortis is a
well-diversified leader in the North American regulated electric
and gas utility industry, with 2019 revenue of $8.8 billion and
total assets of $56 billion as at June 30, 2020. The
Corporation's 9,000 employees serve utility customers in five
Canadian provinces, nine U.S. states and three Caribbean
countries.
Fortis shares are listed on the TSX and NYSE and
trade under the symbol FTS. Additional information can be accessed
at www.fortisinc.com, www.sedar.com, or www.sec.gov.
Forward-Looking
InformationFortis includes forward-looking information in
this media release within the meaning of applicable Canadian
securities laws and forward-looking statements within the meaning
of the U.S. Private Securities Litigation Reform Act of 1995
(collectively referred to as "forward-looking information").
Forward-looking information reflects expectations of Fortis
management regarding future growth, results of operations,
performance and business prospects and opportunities. Wherever
possible, words such as anticipates, believes, budgets, could,
estimates, expects, forecasts, intends, may, might, plans,
projects, schedule, should, target, will, would and the negative of
these terms and other similar terminology or expressions have been
used to identify the forward-looking information, which includes,
without limitation: forecast capital expenditures and expected
funding sources for 2020 and the period from 2021 through 2025;
targeted average annual dividend growth through 2025; the 2035
carbon emissions reduction target; forecast rate base for 2023 and
2025; TEP's carbon emissions reduction target, 2035 generation mix
and coal-fired generation retirements; and the expectation that
execution of the carbon emissions target as well as key industry
trends will drive incremental investments beyond the five-year
capital plan.
Forward-looking information involves significant
risks, uncertainties and assumptions. Certain material factors or
assumptions have been applied in drawing the conclusions contained
in the forward-looking information. These factors or assumptions
are subject to inherent risks and uncertainties surrounding future
expectations generally, including those identified from time to
time in the forward-looking information. Such factors or
assumptions include, but are not limited to: no material impact
from the COVID-19 pandemic; reasonable outcomes for regulatory
proceedings and the expectation of regulatory stability; the
successful execution of the five-year capital plan; no material
capital project and financing cost overrun; sufficient human
resources to deliver service and execute the capital plan; the
realization of additional opportunities; the impact of fluctuations
in foreign exchange; no significant variability in interest rates;
and the Board exercising its discretion to declare dividends,
taking into account the business performance and financial
condition of the Corporation. Fortis cautions readers that a number
of factors could cause actual results, performance or achievements
to differ materially from the results discussed or implied in the
forward-looking information. For additional information with
respect to certain risk factors, reference should be made to the
continuous disclosure materials filed from time to time by the
Corporation with Canadian securities regulatory authorities and the
Securities and Exchange Commission. All forward-looking information
herein is given as of the date of this media release. Fortis
disclaims any intention or obligation to update or revise any
forward-looking information, whether as a result of new
information, future events or otherwise.
Teleconference to Discuss New Five-Year
Outlook |
A teleconference and webcast will be held today, September 23,
2020, at 8:30 a.m. (Eastern). Barry Perry, President and Chief
Executive Officer, Jocelyn Perry, Executive Vice President and
Chief Financial Officer, David Hutchens, Chief Operating Officer
and CEOs from certain subsidiaries will provide an update on
operations and the business outlook for 2021 to 2025 including the
capital plan and sustainability initiatives.Shareholders, analysts,
members of the media and other interested parties in North America
are invited to participate by calling 1.877.223.4471. International
participants may participate by calling 647.788.4922. Please dial
in 10 minutes prior to the start of the call. No pass code is
required.A live and archived audio webcast of the teleconference
will be available on the Corporation's website, www.fortisinc.com.
A replay of the conference will be available two hours after the
conclusion of the call until October 23, 2020. Please call
1.800.585.8367 or 416.621.4642 and enter pass code 7849679. |
A pdf version of this press release is available
at: http://ml.globenewswire.com/Resource/Download/702abba2-f31b-4f36-90d2-2dfcf9867130
For further information
contactInvestor Enquiries:Ms. Stephanie Amaimo Vice
President, Investor RelationsFortis
Inc.248.946.3572investorrelations@fortisinc.com
Media Enquiries:Ms. Karen McCarthyVice
President, Communications and Corporate AffairsFortis
Inc.709.737.5323media@fortisinc.com
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