Allete Inc.’s targeted earnings growth is supported by the seemingly limitless opportunities found in the nation’s growing renewable energy sector, company leaders told investors today at the Duluth-based energy company’s 2019 annual meeting of shareholders.
More than 900 people attended the 2019 Annual Meeting at the Duluth Entertainment Convention Center, where they elected 10 directors, approved compensation-related resolutions and ratified the selection of Allete’s accounting firm.
After conducting business, they heard from Allete President Bethany Owen, Chairman and CEO Al Hodnik and two other company leaders.
“Minnesota’s call for a carbon-free energy future is being echoed throughout the country,” Owen said. “With many states furthering renewable standards and goals, and federal tax policy fueling growth, Allete is wellpositioned to continue leading the change to cleaner, more sustainable energy solutions, all while creating opportunities for our employees, building shareholder value and delivering the energy future our customers expect.”
Hodnik said a Goldman Sachs study of U.S. and Canadian energy companies ranked Allete the second-largest investor in wind and solar energy relative to those companies’ market capitalizations. The ranking is up from fourth-largest one year ago.
He said Allete’s recent $270 million sale of U.S. Water Services provided an influx of cash that already is being redeployed into more renewable energy investments.
“At 113 years young, our company remains well-positioned as the contours of a new and exciting decade begin to emerge,” Hodnik told shareholders. “Each of us remains committed to our shared purpose—answering the call to transform the nation’s energy landscape—while growing Allete.”
He reported Allete earned $3.38 per share in 2018 on net income of $174.1 million, and Allete’s market capitalization is now roughly $4.3 billion, up from $3.8 billion one year ago.
The company’s board of directors recently increased the dividend 5 percent to $2.35 per share on an annual basis, and Hodnik said the company’s three-year total shareholder return through the end of 2018 was 65.1 percent, ranked eighth of 42 companies within an industry peer group.
Much of Allete’s growth can be attributed to Allete Clean Energy’s renewable projects, with three being developed this year in North Dakota, Montana and Oklahoma. Allete Clean Energy President Al Rudeck said technology advancements and public policy are bringing to reality the clean energy future society demands.
“In the next two years we’ll add about 500 megawatts of wind capacity at three projects, serving five new customer contracts, including developing the largest wind farm in our portfolio,” he said. “These investments will more than double Allete Clean Energy’s total wind capacity, bringing us to more than 1,000 megawatts. This growth demonstrates the potency of our strategy that is paying off for our customers and for Allete shareholders.”
Allete Senior Vice President and President of Regulated Operations Brad Oachs described Minnesota Power’s progress on renewable energy under its EnergyForward strategy. He said the company has moved toward renewable energy faster and further than most similar utilities in Upper Midwest, and will reach 45 percent renewables by 2025, far ahead of the state standard of 25 percent renewables by 2025.
“It has been quite a journey as we transform our energy supply, with more twists and turns ahead on the renewable road,” said Oachs, who is retiring in June. “I have every confidence based on the history of the company, and all the talented and innovative people I’ve known and worked with over the years at the company, that Minnesota Power will continue to respond to the rapid changes in the energy sector with creative solutions that deliver safe and reliable, affordable and increasingly carbon-free energy to power society.”
Owen said Allete’s view of sustainability goes beyond adding renewable energy and being a good environmental steward. She said sustainability includes supporting a healthy society and local communities.
“Allete and its employees do that through grants and donations — and even more importantly volunteer hours — to support organizations that focus on improving the health and vitality of communities across the region,” she said.
Allete’s view of sustainability also extends to its own governance and a commitment to diversity.
“Here today we saw an example of healthy governance in action as we elected a board of directors that is 50 percent women,” she said.
Allete shareholders, voting by proxy at the meeting, elected directors Kathryn W. Dindo, George G. Goldfarb, Alan R. Hodnik, James J. Hoolihan, Heidi E. Jimmerson, Madeleine W. Ludlow, Susan K. Nestegard, Douglas C. Neve, Bethany M. Owen and Robert P. Powers.
The 10th annual Don Shippar Community Leadership Award was presented to Minnesota Power employee Jerry Frederick for his volunteer efforts in northeastern Minnesota.