Brookfield Renewable Partners (BEP 3.25%) (BEPC 3.72%) reported its fourth-quarter and 2020 results Thursday morning, and it didn't disappoint. While delivering record results for the year, the renewable energy company has also given income investors a reason to cheer: a 5% increase in its dividend.
Here's a quick look at Brookfield Renewable's key fourth-quarter and 2020 numbers.
|Metric||Q4 2020||Q4 2019||Change||FY 2020||FY 2019||Change|
|Power generation||6,583 GWh||5,977 GWh||10.1%||26,052 GWh||26,038 GWh||--|
|Normalized funds from operations (FFO)||$265 million||$167 million||58.7%||$924 million||$725 million||27.5%|
|FFO per unit||$0.41||$0.28||46.4%||$1.52||$1.24||22.6%|
In the company's earnings press release, CEO Connor Teskey said: "2020 was another year of significant growth for our business. Despite the economic challenges around the world, we delivered record results and continued to broaden our operations, as we look forward to a multi-decade opportunity to advance decarbonization and assist with the transition of global electricity grids to a more sustainable future."
Thanks to higher power generation buoyed by organic growth and acquisitions, Brookfield Renewable's normalized funds from operation (FFO) per unit jumped nearly 23% in 2020. While the company's hydropower generation was in line with its long-term average rate, its wind and solar segments reported 51% growth in FFO during the year thanks to acquisitions like that of TerraForm Power.
In December, Brookfield Renewable also struck a deal to acquire Exelon's (EXC 1.43%) distributed solar energy business for roughly $810 million in a deal expected to close in the coming months.
Brookfield's development pipeline now stands at 23,000 megawatts, which is a significant improvement over the 13,000 megawatts from a year ago.
The company also ended 2020 with a strong balance sheet, with liquidity of nearly $3.3 billion and no material debt maturing in five years.
Encouraged by strong FFO growth and in keeping with management's long-term target of 5% to 9% annual dividend growth, Brookfield Renewable announced a 5% increase in its dividend, which translates into an annual $1.215 per unit. That's a nice boost for a stock now yielding 2.5%.
Brookfield Renewable's significant pipeline growth and dividend increase come at a time when renewable energy has become the talk of the town, with President Joe Biden proposing a $2 trillion climate plan emphasizing clean energy. For investors, that should only add to the stock's appeal.