Northwest Natural Gas Company (dba NW Natural) is a 150-year-old local gas distribution company located in the Pacific Northwest. Headquartered in Portland, Oregon, NW Natural is the highest-volume independent natural gas distribution company in the region. Its service territory includes the Portland, Oregon, and Vancouver, Washington, metropolitan areas, as well as the population-dense Willamette Valley, the Oregon coast, and the Columbia River Gorge. NW Natural served more than 660,000 customers at the end of 2008. Approximately 90 percent of the company's customers are in Oregon, with the remainder in Washington state.
The company earned $69.5 million or $2.61 per share in 2008, driven by consistent utility results and higher earnings from gas storage operations. In keeping with its steady growth, NW Natural has increased annual dividends paid to shareholders every year for 53 consecutive years. The company has a current indicated annual dividend rate of $1.58 per share. Over the past five years, NW Natural provided an attractive total shareholder return (dividends plus stock price appreciation) that averaged an annualized 11.5 percent.
In addition to serving its utility customers, the company operates a 16 billion cubic foot gas storage facility in Northwestern Oregon -- primarily for its core utility customers -- as well as to serve the regional interstate and intrastate markets. The company is also proposing to build a gas storage facility near Fresno, California, and a gas transmission pipeline in Oregon to add to future growth potential.
The company is also unique from a regulatory perspective, and received renewal of its conservation and weather adjustment tariffs in Oregon until 2012. The company's decoupling mechanism further helps stabilize margin revenues while better aligning the utility's financial interests with customers who elect to conserve energy. As a result, NW Natural's regulatory mechanisms help to protect revenues from warmer than average weather and declining consumption, without penalizing investors, providing reliable earnings growth. The company's stated aim is to target long-term earnings per share growth of 5 percent or more on average and to maintain a dividend payout ratio of 60-70 percent.
The company operates under the symbol "NWN" and is listed on the New York Stock Exchange.
