8-K

ENBRIDGE INC 8-K Report (Feb 19, 2015)

Filed February 19, 2015For Securities:ENBENBMFEBBGFEBRGFEBRZFENBGFENBRFENFFFEBGEFENBFFENBHFENBNFENBOFENBSFEBBNFENNPF

Summary

Enbridge Inc. (ENB) reported its 2014 full-year and fourth-quarter results, highlighting strong operational performance and significant capital project execution. Adjusted earnings for the full year were $1,574 million ($1.90 per common share), demonstrating continued earnings growth. The company announced a substantial 33% increase in its quarterly dividend to $0.465 per common share, effective March 1, 2015, and established a new dividend payout policy targeting 75% to 85% of adjusted earnings. A key strategic announcement was the plan to transfer the majority of its Canadian Liquids Pipelines business and certain renewable energy assets to Enbridge Income Fund, alongside a review of potentially transferring U.S. liquids pipeline assets to Enbridge Energy Partners, L.P. Enbridge successfully placed $10 billion of growth projects into service in 2014, including the Flanagan South Pipeline and Seaway Crude Pipeline System Twinning, which enhances market access to the U.S. Gulf Coast. The company also received National Energy Board approval for its Line 9B reversal and expansion project, with expected service in Q2 2015. With a robust capital program and secured projects, Enbridge reiterated its confidence in delivering 10-12% average annual adjusted earnings per share growth through 2018. The company also made strategic acquisitions in renewable energy, purchasing an 80% interest in two U.S. wind farms.

Key Highlights

  • 1Full-year 2014 adjusted earnings reached $1,574 million ($1.90 per common share), indicating strong financial performance.
  • 2Quarterly dividend increased by 33% to $0.465 per common share, effective March 1, 2015, with a new payout policy of 75-85% of adjusted earnings.
  • 3Announced plans to transfer Canadian Liquids Pipelines and renewable energy assets to Enbridge Income Fund as part of a restructuring strategy.
  • 4Successfully completed $10 billion in growth capital projects in 2014, including Flanagan South and Seaway Crude Pipeline System Twinning, enhancing market access.
  • 5Received National Energy Board approval for Line 9B reversal and expansion, with expected in-service in Q2 2015.
  • 6Reaffirmed confidence in achieving 10-12% average annual adjusted EPS growth through 2018, supported by a $44 billion growth capital program.
  • 7Acquired an 80% interest in two operational U.S. wind farms for approximately $0.3 billion, expanding its renewable energy portfolio.

Frequently Asked Questions

The restructuring plan aims to enhance Enbridge's value by transferring the majority of its Canadian Liquids Pipelines business and certain Canadian renewable energy assets to Enbridge Income Fund. This is intended to allow a larger portion of the growth capital program to be funded at a more advantageous cost, reduce Enbridge's funding requirements, and monetize existing assets to redeploy capital for future growth opportunities.

Enbridge reported strong financial results for 2014, with full-year adjusted earnings of $1,574 million ($1.90 per common share). The company significantly increased its quarterly dividend by 33% to $0.465 per common share, effective March 1, 2015. It also introduced a new dividend payout policy, targeting 75% to 85% of adjusted earnings, signaling confidence in future cash flow generation and a commitment to returning capital to shareholders.

In 2014, Enbridge completed $10 billion in growth capital projects. Key among these are the Flanagan South Pipeline and the Seaway Crude Pipeline System Twinning. These projects are crucial for enhancing market access for producers in Western Canada and the Bakken region, providing direct capacity to the United States Gulf Coast refining hub and strengthening Enbridge's integrated pipeline network.

Enbridge remains optimistic about future growth, driven by a substantial $44 billion capital program, of which $34 billion is commercially secured. The company reiterated its expectation to deliver an average annual adjusted earnings per share growth rate of 10-12% through 2018. This outlook is supported by ongoing project execution, strategic acquisitions in renewables, and the enhanced market access provided by its expanded pipeline infrastructure.