Featured in The Wall Street Transcript’s Best CEO Interviews of 2015
Robert J. Sprowls, President of CEO of American States Water Co (AWR), interviewed with TWST for the Alternative Energy & Utilities report. The stock price increase by approximately 10% since this interview, from $39 to currently $43.
In this interview, Sprowls discusses the utility’s dividend performance:
Our dividend policy is one where we’re focused on providing an increase in our dividend on average of at least 5% per year over the long term, and we think that’s what our shareholders want. We are proud of the fact that we are among a handful of companies on the NYSE that can say that we have increased annual dividends for 60 consecutive years. We’ve been pretty effective over the last few years on raising our dividend. In 2012, we were able to increase the quarterly dividend by 26.8%. In 2013, it was 14.1%, and in 2014, it was 5.2%.
Sprowl’s also said he plans to grow the dividend relative to AWR‘s competitors:
We established American State Utility Services, our contracted services business, and in 2004, we received our first military base privatization contract. For the first four or five years, we struggled to break even for the contracted services business. We really turned the corner in 2009, and we’ve been doing very well with that business ever since. In 2012, we determined that the earnings for that business were sustainable and that we could rely on its earnings to support our dividend. This change in view contributed to the substantial increase in the divided that year. We think the future for the overall company is bright and that our payout ratio is low relative to our peers, which will give us room to grow the dividend over time.
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