RICHMOND, Va., Dec. 17, 2010 /PRNewswire-FirstCall/ -- The board of directors of Dominion (NYSE: D) today set a new dividend policy to achieve a 60-65 percent payout ratio. The new policy replaces one established in October 2007 to achieve a 55 percent payout ratio by 2010. The board also set a 2011 dividend rate of $1.97 per share of common stock, up from $1.83 per share this year, or a 7.7 percent increase. Subject to board declaration in January, the first quarterly dividend of 49.25 cents per share will be payable in March 2011.
Thomas F. Farrell II, chairman, president and chief executive officer, said: "We believe that returning 60-65 percent of our operating earnings to Dominion shareholders better reflects our transition to a company whose earnings are more heavily tied to regulated operations. Today's action will put our dividend payout ratio more in line with that of our utility peers."
The expected 7.7 percent rise in the 2011 dividend rate follows increases of 11 percent, 11 percent and 4.6 percent in 2008, 2009, and 2010, respectively.
Dominion is one of the nation's largest producers and transporters of energy, with a portfolio of approximately 27,600 megawatts of generation, 12,000 miles of natural gas transmission, gathering and storage pipeline and 6,000 miles of electric transmission lines. Dominion operates the nation's largest natural gas storage system with 942 billion cubic feet of storage capacity and serves retail energy customers in 13 states. For more information about Dominion, visit the company's website at www.dom.com.
Payment of the 2011 dividend is subject to quarterly determination and declaration by the board of directors of specific record and payable dates.