TransCanada Corp. increased its dividend by 5% Tuesday after the company’s adjusted profit exceeded analyst estimates for the fourth quarter.

Overall, the Calgary-based company’s net income for the period was down 29% to $269-million, or 39¢ a share, compared with $381-million, or 56¢ per share during the fourth quarter of 2009.

However, excluding a $127-million (18¢ a share) one-time after-tax valuation provision, TransCanada’s net income was $384-million for the quarter, or 55¢ per share. Analysts polled by Bloomberg had been expecting adjusted earnings of 53¢ for the quarter.

"TransCanada's strong comparable earnings for the fourth quarter of 2010 demonstrates the stability of our core businesses," CEO Russ Girling said in a release. "The company continues to advance its unprecedented $20 billion capital program as more projects begin operations.”

For the 11th consecutive year TransCanada also increased its dividend. The company announced that its quarterly dividend would now pay 42¢ per common share, with annual payouts amounting to $1.68.

Net income for the year was slightly lower in 2010, coming in at $1.2 billion ($1.78 a share), compared with $1.4 billion ($2.11 per share) in 2009.

However, when excluding one-time items, TransCanada said profit was slightly higher in 2010. The company said that barring expenses such as the $127-million after tax expense in the fourth quarter, profit came in at $1.4-billion ($1.97 a share), compared with profit of $1.3-billion in 2009.