NEWARK, N.J., Feb. 21, 2012 /PRNewswire/ -- The board of directors of Public Service Enterprise Group (NYSE: PEG) declared a 3.6% increase in the company's common stock dividend today. PSEG has paid annual dividends on an uninterrupted basis since 1907.
The board increased the quarterly dividend to 35.5 cents per share, a 3.6% increase over the company's existing quarterly dividend rate of 34.25 cents per share. The first dividend in 2012 is payable on March 31, 2012, to shareholders of record on March 9, 2012.
The board's action increases the indicated annual common stock dividend rate to $1.42 per share from $1.37 per share. The board's action also represents a revision of the company's dividend payout policy from its prior stated goal of paying out 40% - 50% of earnings as dividends to a policy that pays out a greater percentage of earnings as dividends with an expectation for future dividend growth.
Ralph Izzo, chairman, president and chief executive officer, said, "We are pleased to be able to increase the cash return to our shareholders. The dividend increase represents a re-set of our annual dividend rate. Our balance sheet has been strengthened, and our cash flow remains strong. In addition, the contribution to earnings from our more stable, regulated business has grown as a percent of earnings, and is expected to continue to grow. We made progress on our operational, capital investment and financial goals in 2011 which along with continued cash flow in our generation business should provide the support for future growth in the dividend. Growth would be in line with expectations for improvement in our regulated cash flow." All future changes in the common stock dividend are subject to board approval.