The board of directors of electricity and natural gas company
Xcel Energy Inc.
) has approved a penny increase to the quarterly dividend of the
company. The new quarterly dividend will be 28 cents. The revised
dividend is payable on Jul 20, 2013, to shareholders of record at
the close of business on Jun 20, 2013.
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The new annualized dividend rate of the company will be $1.12,
reflecting growth of 3.7% from the prior rate of $1.08. The
dividend growth rate is at the top end of Xcel Energy's targeted
annual growth rate of 2% to 4%. The previous increase in the
quarterly dividend rate was on May 16, 2012, when the rate was
increased to 27 cents from 26 cents.
Xcel Energy continues to register strong financial performance
and has accordingly raised the dividend payment rate by more than
3% annually for the last eight years. In first quarter 2013, an
8% and 7.8% year-over-year increase in contribution from Electric
and Natural Gas segments, respectively, shows that systematic
investments in its utility operations are yielding positive
results for the company.
The company is a strong cash flow generator and boasts of a
healthy cash balance. Xcel's net cash flow from operating
activities in the first quarter of 2013 was $642.3 million, with
$124.4 million used for dividend payouts. Cash and cash
equivalents as of Mar 31, 2013 were $112.9 million versus $99.4
million as March 31, 2012.
Like other utility operators Xcel Energy too has a long history
of consistently paying dividends. The company's strong cash flow
generating ability will easily provide the extra $4.9 million
required for the increased dividend payment.
In addition to Xcel Energy, other utility operators have also
hiked their quarterly dividend rate.
American Electric Power Co
) increased its quarterly dividend rate by 4% to 49 cents.
) hiked the quarterly rate by 3.3% to 47.5 cents.
Chesapeake Utilities Corporation
) raised its quarterly dividend rate by 5.5% to 38.5 cents.
Based in Minneapolis, Minn., Xcel Energy is a U.S. electricity
and natural gas company, with operations in eight Western and
Midwestern states. Xcel Energy currently retains a Zacks Rank #3