Penney stock

Moira Baird
Send to a friend

Send this article to a friend.

Seventy-three-year-old Fortis shares pay dividends for the long haul

Nathan Penney remembers the day his family became Fortis Inc. shareholders - 64 years ago as he and his wife, Grace, were getting married.

An uncle made a wedding present of his own shares in a Conception Bay North utility known as United Towns Electric Company. The shares were issued in 1937.

Nathan Penney, 89, talks about the wedding present that paid dividends. - Photo by Gary Hebbard/The Telegram

Nathan Penney remembers the day his family became Fortis Inc. shareholders - 64 years ago as he and his wife, Grace, were getting married.

An uncle made a wedding present of his own shares in a Conception Bay North utility known as United Towns Electric Company. The shares were issued in 1937.

"This gave my wife a private income," Penney said of his spouse, who is now deceased. "It wasn't very much, but it was always a little bit of joke between us that she had a private income."

United Towns Electric Co. was a forerunner of Newfoundland Power, which is owned by publicly traded Fortis.

"We continued to collect and buy whenever we could because that was our investment," said Penney.

"Those original shares were converted and are still giving me an income."

The 89-year-old regularly attends Fortis' annual shareholder meetings - "I never miss one" - and has noticed some things over the years.

One change: shareholders are treated to lunch at the Fortis-owned Holiday Inn in St. John's where the meeting is held.

"Shareholder meetings weren't like this in those days," Penney said, thinking back. "We'd maybe have 15 or 20 people at the very most, and anybody would make a motion and anybody would second it. I used to second it back in those days."

Penney, who ran a family sales business, retired about three decades ago. Regular dividends from the Fortis stock were part of the retirement plan.

"I'm so pleased that we held onto the Fortis stock. I'm living just a little happier these days because I have Fortis in the bank."

Penney said the shares do better than his GICs (guaranteed investment certificates).

He expects the shares will stay in the family.

"The will says that my two grandchildren will share those shares equally. They know that. All they've got to do is live long enough for their inheritance."

Larry Short, senior investment adviser for Dundee Wealth Management, figures shares in United Towns Electric Co. might have been worth a Newfoundland penny when they were issued in 1937.

"That is only a guess.

"Because they were private, they didn't necessarily disclose how the purchase prices were made at the time."

Short could only trace the shares of Fortis' predecessors back to 1972 when they were worth $1.53 apiece.

These days, Fortis shares are worth about $28 per share, though this week's stock market glitch saw them drop to the $25-$26 range on Friday.

"It's paid out dividends every year," said Short.

"Right now the dividend is $1.12. So, if you bought something at $1.53, you're getting like an 80 per cent return every single year on that $1.53.

"That's pretty good."

And Penney has a point about the GICs.

"Even in today's dollars, it's near to about a four per cent dividend, which is about the same as a six per cent GIC these days," said Short.

United Towns Electric Co. was founded in 1902. It supplied electricity to Heart's Content, Carbonear, Harbour Grace and other communities in Conception Bay North.

In the early 1930s, it acquired Wabana Light and Power Co. and Public Service Electric Co.

By 1966, United Towns Electric Co. merged with Union Electric Light and Power and Newfoundland Light and Power.

The merged company would take its name from the largest of the three, Newfoundland Light and Power.

In 1987, Fortis was created as a holding company to buy the assets of the power company and get involved in non-regulated businesses, such as commercial real estate.

During Fortis' annual shareholder meeting earlier this week, company president and CEO Stan Marshall said Penney's 73-year-old shares were the company's longest-held stock.

"If there's anybody in the audience that can beat that, stand up," he said.

No one did.

mbaird@thetelegram.com

Organizations: Fortis Inc., United Towns Electric Co., United Towns Electric Company Newfoundland Power Holiday Inn Dundee Wealth Management Wabana Light and Power Co. Public Service Electric Co. Union Electric

Geographic location: Conception Bay North, Newfoundland, St. John's

  • 1
  • 2
  • 3
  • 4
  • 5

Thanks for voting!

Top of page

Comments

Comments

Recent comments

  • Taxpayer
    July 02, 2010 - 13:19

    Dave talk about uninformed comments you are a case in point. Yes like in Labrador I would get my electricity from Nalcor if I could. But I can't because of monopolistic laws. Oh to live in a free country!

  • David
    July 02, 2010 - 13:16

    Hey, Taxpayer:

    The power your computer draws for you to post uninformed, socialist comments was provided for a reason...to make a return.

    Would you do it cheaper instead? If so, please go right ahead.

  • Taxpayer
    July 02, 2010 - 13:10

    Twenty-five years ago GIC's were paying better than Fortis shares. So it is incorrect to say that they will always paid a better return. Anyway the backs of the ratepayers are strong and they can pay excessive profits to Nf Power.

  • Steve
    July 02, 2010 - 13:08

    You cannot beat stocks in well established utility based companies.

    They are pretty well guaranteed to make a profit from year to year. It is on that principle they are usually always guaranteed rate increases to ensure that they are profitable.

  • Taxpayer
    July 01, 2010 - 20:01

    Dave talk about uninformed comments you are a case in point. Yes like in Labrador I would get my electricity from Nalcor if I could. But I can't because of monopolistic laws. Oh to live in a free country!

  • David
    July 01, 2010 - 19:56

    Hey, Taxpayer:

    The power your computer draws for you to post uninformed, socialist comments was provided for a reason...to make a return.

    Would you do it cheaper instead? If so, please go right ahead.

  • Taxpayer
    July 01, 2010 - 19:45

    Twenty-five years ago GIC's were paying better than Fortis shares. So it is incorrect to say that they will always paid a better return. Anyway the backs of the ratepayers are strong and they can pay excessive profits to Nf Power.

  • Steve
    July 01, 2010 - 19:43

    You cannot beat stocks in well established utility based companies.

    They are pretty well guaranteed to make a profit from year to year. It is on that principle they are usually always guaranteed rate increases to ensure that they are profitable.