NEW JERSEY RESOURCES REPORTS FISCAL 2024 FIRST-QUARTER RESULTS;
INCREASES NET FINANCIAL EARNINGS GUIDANCE FOR FISCAL 2024
Maintains its Long-term Projected Growth Rate
WALL, N.J., February 6, 2024 — Today, New Jersey Resources Corporation (NYSE: NJR) reported
results for the first quarter of fiscal 2024. Highlights include:
| • |
Consolidated net income of $89.4 million, compared with $115.9
million in the first quarter of fiscal 2023
|
| • |
Consolidated net financial earnings (NFE), a non-GAAP financial measure, of $72.4 million, or $0.74 per share, compared to $110.3 million, or $1.14
per share, in the first quarter of fiscal 2023. The comparable prior year period included
unusually high net financial earnings at Energy Services related to Winter Storm Elliott in December 2022
|
| • |
Increases fiscal 2024 net financial earnings per share (NFEPS) guidance range to $2.85 to $3.00, from $2.70 to $2.85, a $0.15 increase, as a result of strong performance from Energy Services in January 2024,
the beginning of the fiscal second quarter; maintains long-term projected NFEPS growth rate of 7 to 9
percent(1)
|
| • |
New Jersey Natural Gas (NJNG) filed a rate case with the New Jersey Board of Public Utilities (BPU), seeking a
|
$222.6 million increase in delivery
rates
| • |
NJNG filed with the BPU a proposed next generation of SAVEGREEN™ energy-efficiency offerings totaling $482.4 million
|
First-quarter fiscal 2024 net income totaled $89.4 million, or $0.91 per
share, compared with $115.9 million, or $1.20 per share, for the same period in fiscal 2023. First-quarter fiscal
2024 NFE totaled $72.4 million, or $0.74 per share, compared with $110.3 million, or $1.14 per share, for the same period in fiscal 2023.
Management Commentary
Steve Westhoven, President and CEO of New Jersey Resources, stated, "Our results for the first quarter
were consistent with our expectations. Additionally, our performance in the beginning of our fiscal second quarter has exceeded our original projections, as Energy Services
benefited from natural gas price volatility. As a result, we are raising our fiscal 2024 NFEPS guidance range by $0.15 to $2.85 to $3.00."
Key Performance Metrics
| |
|
Three Months Ended
December 31,
|
|
|
($ in Thousands)
|
|
2023
|
|
|
2022
|
|
|
Net income
|
|
$
|
89,411
|
|
|
$
|
115,921
|
|
|
Basic EPS
|
|
$
|
0.91
|
|
|
$
|
1.20
|
|
|
Net financial earnings
|
|
$
|
72,444
|
|
|
$
|
110,284
|
|
|
Basic net financial earnings per share
|
|
$
|
0.74
|
|
|
$
|
1.14
|
|
(1) NFEPS long-term annual growth projections are based on the midpoint of the $2.20 - $2.30 initial guidance range for fiscal 2022, provided on
February 1, 2021
A reconciliation of net income to NFE for the three months ended December 31, 2023 and 2022, is provided below.
| |
|
Three Months Ended
December 31,
|
|
|
(Thousands)
|
|
2023
|
|
|
2022
|
|
|
Net income
|
|
$
|
89,411
|
|
|
$
|
115,921
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
Unrealized gain on derivative instruments and related transactions
|
|
|
(5,400
|
)
|
|
|
(31,503
|
)
|
|
Tax effect
|
|
|
1,282
|
|
|
|
7,487
|
|
|
Effects of economic hedging related to natural gas inventory
|
|
|
(16,228
|
)
|
|
|
23,972
|
|
|
Tax effect
|
|
|
3,857
|
|
|
|
(5,697
|
)
|
|
NFE tax adjustment
|
|
|
(478
|
)
|
|
|
104
|
|
|
Net financial earnings
|
|
$
|
72,444
|
|
|
$
|
110,284
|
|
| |
|
|
|
|
|
|
|
|
|
Weighted Average Shares Outstanding
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
97,869
|
|
|
|
96,485
|
|
|
Diluted
|
|
|
98,563
|
|
|
|
97,083
|
|
| |
|
|
|
|
|
|
|
|
|
Basic earnings per share
|
|
$
|
0.91
|
|
|
$
|
1.20
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
Unrealized gain on derivative instruments and related transactions
|
|
|
(0.05
|
)
|
|
|
(0.33
|
)
|
|
Tax effect
|
|
|
0.01
|
|
|
|
0.08
|
|
|
Effects of economic hedging related to natural gas inventory
|
|
|
(0.17
|
)
|
|
|
0.25
|
|
|
Tax effect
|
|
|
0.04
|
|
|
|
(0.06
|
)
|
|
Basic net financial earnings per share
|
|
$
|
0.74
|
|
|
$
|
1.14
|
|
NFE is a measure of earnings based on the elimination of timing differences to effectively match the earnings effects of the economic hedges with the physical sale of
natural gas, Solar Renewable Energy Certificates (SRECs) and foreign currency contracts. Consequently, to reconcile net income and NFE, current-period unrealized gains and losses on the derivatives are excluded from NFE as a reconciling item.
Realized derivative gains and losses are also included in current-period net income. However, NFE includes only realized gains and losses related to natural gas sold out of inventory, effectively matching the full earnings effects of the derivatives
with realized margins on physical natural gas flows. NFE also excludes certain transactions associated with equity method investments, including impairment charges, which are non-cash charges, and return of capital in excess of the carrying value of
our investment. These are not indicative of the Company's performance for its ongoing operations. Included in the tax effects are current and deferred income tax expense corresponding with the components of NFE.
A table detailing NFE for the three months ended December 31, 2023 and 2022, is provided below.
Net financial earnings (loss) by business unit
| |
|
Three Months Ended
December 31,
|
|
|
(Thousands)
|
|
2023
|
|
|
2022
|
|
|
New Jersey Natural Gas
|
|
$
|
51,444
|
|
|
$
|
54,664
|
|
|
Clean Energy Ventures
|
|
|
10,522
|
|
|
|
(3,582
|
)
|
|
Storage and Transportation
|
|
|
3,640
|
|
|
|
6,243
|
|
|
Energy Services
|
|
|
7,831
|
|
|
|
52,533
|
|
|
Home Services and Other
|
|
|
(600
|
)
|
|
|
(29
|
)
|
|
Subtotal
|
|
|
72,837
|
|
|
|
109,829
|
|
|
Eliminations
|
|
|
(393
|
)
|
|
|
455
|
|
|
Total
|
|
$
|
72,444
|
|
|
$
|
110,284
|
|
Fiscal 2024 NFE Guidance:
NJR is raising its fiscal 2024 NFEPS guidance range by $0.15 to a range of $2.85 to $3.00, subject to the risks and
uncertainties identified below under "Forward-Looking Statements."
In fiscal 2024, NJR expects Energy Services will represent a higher percentage of NFEPS than in
prior years due to contributions from the Asset Management Agreements signed in 2020. The following chart represents NJR’s current expected contributions from its business segments for fiscal 2024:
|
Company
|
Expected Fiscal 2024
Net Financial Earnings
Contribution
|
|
New Jersey Natural Gas
|
40 to 45 percent
|
|
Clean Energy Ventures
|
12 to 17 percent
|
|
Storage and Transportation
|
3 to 7 percent
|
|
Energy Services
|
38 to 43 percent
|
|
Home Services and Other
|
0 to 1 percent
|
In providing fiscal 2024 NFE
guidance, management is aware there could be differences between reported GAAP earnings and NFE due to matters such as, but not limited to, the positions of our energy-related derivatives. Management is not able to reasonably estimate the aggregate
impact or significance of these items on reported earnings and, therefore, is not able to provide a reconciliation to the corresponding GAAP equivalent for its operating earnings guidance without unreasonable efforts.
New Jersey Natural Gas (NJNG)
NJNG reported first-quarter fiscal 2024 NFE of $51.4 million, compared to NFE of $54.7
million during the same period in fiscal 2023. NJNG reported higher utility gross margin for the period, more than offset by higher depreciation and operating expenses.
Customer Growth:
| • |
NJNG added 2,129 new customers during the first
quarter of fiscal 2024, compared with 2,132 in the first quarter of fiscal 2023. NJNG expects these new customers to contribute approximately $1.9 million of
incremental utility gross margin on an annualized basis.
|
Base Rate Filing:
| • |
On January 31, 2024, NJNG filed a base rate case with the BPU, seeking a $222.6 million increase to its base
|
rates. The filing is based on an overall return of 7.57 percent with a return
on equity of 10.42 percent. The
proposed increase reflects a 55.42 percent common equity component.
Infrastructure Update:
| • |
NJNG's Infrastructure Investment Program (IIP) is a five-year, $150 million accelerated recovery program that began in fiscal 2021. IIP consists of a series of infrastructure projects designed to enhance the safety and reliability of
NJNG's natural gas distribution system. During the first quarter of fiscal 2024, NJNG spent $7.3 million under the program on various distribution system reinforcement projects. In September 2023, the BPU approved NJNG's
annual IIP filing, which requested a rate increase for capital expenditures of $28.2 million through June 30, 2023, which resulted in a $3.2 million revenue increase, effective October 1, 2023.
|
Basic Gas Supply Service (BGSS) Incentive Programs:
BGSS incentive programs contributed $5.4 million to utility gross margin in the first quarter of fiscal 2024, compared
with $8.7 million during the same period of fiscal 2023. This decline was largely due to lower off-system sales margin due to lower natural gas prices and a lack of weather volatility in the first quarter of fiscal 2024.
For more information on utility gross margin, please see "Non-GAAP Financial Information" below.
Energy-Efficiency Programs:
SAVEGREEN™ invested $12.5 million in the first quarter of fiscal 2024 in energy-efficiency upgrades for customers' homes and businesses. NJNG recovered $4.4 million of its outstanding investments during the first quarter
of fiscal 2024 through its energy efficiency rate.
|
• |
On December 1, 2023, NJNG filed the proposed next generation of SAVEGREEN™ energy-efficiency offerings with the BPU. The $482.4
million proposal will strengthen NJNG’s existing energy-efficiency offerings and provide comprehensive solutions to help participating customers save energy and reduce carbon emissions, while supporting New Jersey’s ambitious climate
goals. If approved by the BPU, the new SAVEGREEN™ program cycle is expected to begin January 1, 2025 and run through June 30, 2027.
|
Clean Energy Ventures (CEV)
CEV reported first-quarter fiscal
2024 NFE of $10.5 million, compared with a net financial loss of $(3.6) million during the
same period in fiscal 2023. The increase in NFE for the first quarter of fiscal 2024 was largely due to higher SREC and Transition Renewable Energy Certificate (TREC) revenue for the period, partially
offset by lower electricity prices.
Solar Investment Update:
|
• |
As of December 31, 2023, CEV had approximately 473MW
of solar capacity (including residential) in service in New Jersey, New York, Connecticut, Rhode Island, Indiana, and Michigan.
|
Storage and Transportation
Storage and Transportation reported first-quarter fiscal 2024 NFE of $3.6 million, compared with NFE of $6.2 million
during the same period in fiscal 2023. The decrease in NFE was largely due to higher operating revenues in
the prior year period relating to Winter Storm Elliott.
Energy Services
Energy Services reported first-quarter fiscal 2024 NFE of $7.8 million compared with NFE of $52.5 million for the same
period in fiscal 2023. The lower NFE for the first quarter of fiscal 2024 was due primarily to
higher natural gas price volatility in the prior year period, as a result of Winter Storm Elliott.
Home Services and Other Operations
Home Services and Other Operations reported a first-quarter fiscal 2024 net financial loss of $(0.6) million, which was consistent with a net financial loss of $(0.03) million for the same period in fiscal 2023.
Capital Expenditures and Cash Flows:
NJR is committed to maintaining a strong financial profile:
| • |
During the first quarter of fiscal 2024, capital expenditures were $118.1 million,
including accruals, compared with $137.0 million during the same period of fiscal 2023.
The decrease in capital expenditures was primarily due to lower solar capital expenditures during the period as a result of the timing of several large projects being placed into service in the prior year.
|
| • |
During the first quarter of fiscal 2024, cash
flows from operations were $46.4 million, compared with cash flows used in operations of $(88.9)
million during the same period of fiscal 2023. The increase in operating cash flows was mostly due to decreased working capital requirements as a result of lower gas prices for the period.
|
Forward-Looking Statements:
This earnings release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of
the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. NJR cautions readers that the assumptions forming the basis for forward-looking statements include many factors that are beyond NJR’s ability
to control or estimate precisely, such as estimates of future market conditions and the behavior of other market participants. Words such as “anticipates,” “estimates,” “expects,” “projects,” “may,” “will,” “intends,” “plans,” “believes,” “should”
and similar expressions may identify forward-looking statements and such forward-looking statements are made based upon management’s current expectations, assumptions and beliefs as of this date concerning future developments and their potential
effect upon NJR. There can be no assurance that future developments will be in accordance with management’s expectations, assumptions and beliefs or that the effect of future developments on NJR will be those anticipated by management.
Forward-looking statements in this earnings release include, but are not limited to, certain statements regarding NJR’s NFEPS guidance for fiscal 2024, projected NFEPS growth rates and our guidance range, NFEPS Contributions, forecasted contribution
of business segments to NJR’s NFE for fiscal 2024, customer growth at NJNG and their expected contributions, expected contributions from Asset Management Agreements, infrastructure programs and investments, future decarbonization opportunities
including IIP, Energy efficiency programs, including BGSS, the outcome or timing of our Base Rate Case with the BPU, and other legal and regulatory expectations.
Additional information and factors that could cause actual results to differ materially from NJR’s expectations are contained in NJR’s filings with the
SEC, including NJR’s Annual Reports on Form 10-K and subsequent Quarterly Reports on Form 10-Q, recent Current Reports on Form 8-K, and other SEC filings, which are available at the SEC’s web site, http://www.sec.gov. Information included in this
earnings release is representative as of today only and while NJR periodically reassesses material trends and uncertainties affecting NJR's results of operations and financial condition in connection with its preparation of management's discussion
and analysis of results of operations and financial condition contained in its Quarterly and Annual Reports filed with the SEC, NJR does not, by including this statement, assume any obligation to review or revise any particular forward-looking
statement referenced herein in light of future events.
Non-GAAP Financial Information:
This earnings release includes the non-GAAP financial measures NFE/net financial loss, NFE per basic share, financial margin and utility gross margin. A
reconciliation of these non-GAAP financial measures to the most directly comparable financial measures calculated and reported in accordance with GAAP can be found below. As an indicator of NJR’s operating performance, these measures should not be
considered an alternative to, or more meaningful than, net income or operating revenues as determined in accordance with GAAP. This information has been provided pursuant to the requirements of SEC Regulation G.
NFE and financial margin exclude unrealized gains or losses on derivative instruments
related to NJR’s unregulated subsidiaries and certain realized gains and losses on derivative instruments related to natural gas that has been placed into storage at Energy Services, net of applicable tax adjustments as described below. Financial
margin also differs from gross margin as defined on a GAAP basis as it excludes certain operations and maintenance expense and depreciation and amortization as well as the effects of derivatives as discussed above. Volatility associated with the change in value of these financial instruments and physical commodity reported on the income statement in the current period. In order to manage its business, NJR
views its results without the impacts of the unrealized gains and losses, and certain realized gains and losses, caused by changes in value of these financial instruments and physical commodity contracts prior to the completion of the planned
transaction because it shows changes in value currently instead of when the planned transaction ultimately is settled. An annual estimated effective tax rate is calculated for NFE purposes and any necessary quarterly tax adjustment is applied to
NJR Energy Services Company.
NJNG’s utility gross margin is defined as operating revenues less natural gas purchases,
sales tax, and regulatory rider expense. This measure differs from gross margin as presented on a GAAP basis as it excludes certain operations and maintenance
expense and depreciation and amortization. Utility gross margin may also not be comparable to the definition of gross margin used by others in the natural gas distribution business and other
industries. Management believes that utility gross margin provides a meaningful basis for evaluating utility operations since natural gas costs, sales tax and regulatory rider expenses are included in operating revenues and passed through to
customers and, therefore, have no effect on utility gross margin.
Management uses these non-GAAP financial measures as supplemental measures to other GAAP results to provide a more complete understanding of NJR’s
performance. Management believes these non-GAAP financial measures are more reflective of NJR’s business model, provide transparency to investors and enable period-to-period comparability of financial performance. A reconciliation of all non-GAAP
financial measures to the most directly comparable financial measures calculated and reported in accordance with GAAP can be found below. For a full discussion of NJR’s non-GAAP financial measures, please see NJR’s most recent Report on Form 10-K,
Item 7.
About New Jersey Resources
New Jersey Resources (NYSE: NJR) is a Fortune 1000
company that, through its subsidiaries, provides safe and reliable natural gas and clean energy services, including transportation, distribution, asset management and home services. NJR is composed of five primary businesses:
| • |
New Jersey Natural Gas, NJR’s principal subsidiary, operates and maintains natural gas transportation and distribution infrastructure to serve approximately 579,600 customers in New Jersey’s Monmouth, Ocean, Morris, Middlesex, Sussex and Burlington counties.
|
| • |
Clean Energy Ventures invests in, owns and operates solar
projects with a total capacity of approximately 473 megawatts, providing residential and commercial customers with low-carbon solutions.
|
| • |
Energy Services manages a diversified portfolio of natural gas
transportation and storage assets and provides physical natural gas services and customized energy solutions to its customers across North America.
|
| • |
Storage and Transportation serves customers from local
distributors and producers to electric generators and wholesale marketers through its ownership of Leaf River and the Adelphia Gateway Pipeline, as well as our 50%
equity ownership in the Steckman Ridge natural gas storage facility.
|
| • |
Home Services provides service contracts as well as heating,
central air conditioning, water heaters, standby generators, solar and other indoor and outdoor comfort products to residential homes throughout New Jersey.
|
NJR and its over 1,300 employees are committed to helping customers save energy and money by promoting conservation and encouraging efficiency through Conserve to Preserve®
and initiatives such as The SAVEGREEN Project® and The Sunlight Advantage®.
For more information about NJR:
www.njresources.com.
Follow us on X.com (Twitter) @NJNaturalGas.
“Like” us on facebook.com/NewJerseyNaturalGas.
NEW JERSEY RESOURCES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| |
|
Three Months Ended
December 31,
|
|
|
(Thousands, except per share data)
|
|
2023
|
|
|
2022
|
|
|
OPERATING REVENUES
|
|
|
|
|
|
|
|
Utility
|
|
$
|
293,093
|
|
|
$
|
357,409
|
|
|
Nonutility
|
|
|
174,117
|
|
|
|
366,158
|
|
|
Total operating revenues
|
|
|
467,210
|
|
|
|
723,567
|
|
|
OPERATING EXPENSES
|
|
|
|
|
|
|
|
|
|
Gas purchases
|
|
|
|
|
|
|
|
|
|
Utility
|
|
|
116,120
|
|
|
|
182,446
|
|
|
Nonutility
|
|
|
59,477
|
|
|
|
232,070
|
|
|
Related parties
|
|
|
1,879
|
|
|
|
1,827
|
|
|
Operation and maintenance
|
|
|
94,439
|
|
|
|
79,501
|
|
|
Regulatory rider expenses
|
|
|
19,189
|
|
|
|
18,251
|
|
|
Depreciation and amortization
|
|
|
40,287
|
|
|
|
36,683
|
|
|
Total operating expenses
|
|
|
331,391
|
|
|
|
550,778
|
|
|
OPERATING INCOME
|
|
|
135,819
|
|
|
|
172,789
|
|
|
Other income, net
|
|
|
6,341
|
|
|
|
4,655
|
|
|
Interest expense, net of capitalized interest
|
|
|
31,473
|
|
|
|
29,491
|
|
|
INCOME BEFORE INCOME TAXES AND EQUITY IN EARNINGS OF AFFILIATES
|
|
|
110,687
|
|
|
|
147,953
|
|
|
Income tax provision
|
|
|
22,936
|
|
|
|
32,978
|
|
|
Equity in earnings of affiliates
|
|
|
1,660
|
|
|
|
946
|
|
|
NET INCOME
|
|
$
|
89,411
|
|
|
$
|
115,921
|
|
| |
|
|
|
|
|
|
|
|
|
EARNINGS PER COMMON SHARE
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.91
|
|
|
$
|
1.20
|
|
|
Diluted
|
|
$
|
0.91
|
|
|
$
|
1.19
|
|
| |
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE SHARES OUTSTANDING
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
97,869
|
|
|
|
96,485
|
|
|
Diluted
|
|
|
98,563
|
|
|
|
97,083
|
|
RECONCILIATION OF NON-GAAP PERFORMANCE MEASURES
(Unaudited)
| |
|
Three Months Ended
December 31,
|
|
|
(Thousands)
|
|
2023
|
|
|
2022
|
|
|
NEW JERSEY RESOURCES
|
|
|
|
|
|
|
| |
|
|
A reconciliation of net income, the closest GAAP financial measure, to net financial earnings is as
follows:
|
|
| |
|
|
|
|
|
|
|
Net income
|
|
$
|
89,411
|
|
|
$
|
115,921
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
Unrealized gain on derivative instruments and related transactions
|
|
|
(5,400
|
)
|
|
|
(31,503
|
)
|
|
Tax effect
|
|
|
1,282
|
|
|
|
7,487
|
|
|
Effects of economic hedging related to natural gas inventory
|
|
|
(16,228
|
)
|
|
|
23,972
|
|
|
Tax effect
|
|
|
3,857
|
|
|
|
(5,697
|
)
|
|
NFE tax adjustment
|
|
|
(478
|
)
|
|
|
104
|
|
|
Net financial earnings
|
|
$
|
72,444
|
|
|
$
|
110,284
|
|
| |
|
|
|
|
|
|
|
|
|
Weighted Average Shares Outstanding
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
97,869
|
|
|
|
96,485
|
|
|
Diluted
|
|
|
98,563
|
|
|
|
97,083
|
|
| |
|
|
|
|
|
|
|
|
|
A reconciliation of basic earnings per share, the closest GAAP financial measure, to basic net
financial earnings per share is as follows:
|
|
| |
|
|
|
|
|
|
|
|
|
Basic earnings per share
|
|
$
|
0.91
|
|
|
$
|
1.20
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
Unrealized gain on derivative instruments and related transactions
|
|
$
|
(0.05
|
)
|
|
$
|
(0.33
|
)
|
|
Tax effect
|
|
$
|
0.01
|
|
|
$
|
0.08
|
|
|
Effects of economic hedging related to natural gas inventory
|
|
$
|
(0.17
|
)
|
|
$
|
0.25
|
|
|
Tax effect
|
|
$
|
0.04
|
|
|
$
|
(0.06
|
)
|
|
Basic net financial earnings per share
|
|
$
|
0.74
|
|
|
$
|
1.14
|
|
| |
|
|
|
|
|
|
|
|
|
NATURAL GAS DISTRIBUTION
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
A reconciliation of gross margin, the closest GAAP financial measure, to utility gross margin is as
follows:
|
|
| |
|
|
|
|
|
|
|
|
|
Operating revenues
|
|
$
|
293,430
|
|
|
$
|
357,746
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
Natural gas purchases
|
|
|
118,444
|
|
|
|
184,771
|
|
|
Operating and maintenance (1)
|
|
|
26,401
|
|
|
|
26,294
|
|
|
Regulatory rider expense
|
|
|
19,189
|
|
|
|
18,251
|
|
|
Depreciation and amortization
|
|
|
26,917
|
|
|
|
24,890
|
|
|
Gross margin
|
|
|
102,479
|
|
|
|
103,540
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
Operating and maintenance (1)
|
|
|
26,401
|
|
|
|
26,294
|
|
|
Depreciation and amortization
|
|
|
26,917
|
|
|
|
24,890
|
|
|
Utility gross margin
|
|
$
|
155,797
|
|
|
$
|
154,724
|
|
|
(1)
|
Excludes selling, general and administrative expenses of $28.3 million and $23.4 million for the three
months ended December 31, 2023 and 2022, respectively.
|
RECONCILIATION OF NON-GAAP PERFORMANCE MEASURES (continued)
(Unaudited)
| |
|
Three Months Ended
December 31,
|
|
|
(Thousands)
|
|
2023
|
|
|
2022
|
|
|
ENERGY SERVICES
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
A reconciliation of gross margin, the closest GAAP financial measure, to Energy Services' financial
margin is as follows:
|
|
| |
|
|
|
|
|
|
|
Operating revenues
|
|
$
|
99,668
|
|
|
$
|
321,782
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
Natural Gas purchases
|
|
|
60,166
|
|
|
|
233,287
|
|
|
Operation and maintenance (1)
|
|
|
4,689
|
|
|
|
3,455
|
|
|
Depreciation and amortization
|
|
|
57
|
|
|
|
57
|
|
|
Gross margin
|
|
|
34,756
|
|
|
|
84,983
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
Operation and maintenance (1)
|
|
|
4,689
|
|
|
|
3,455
|
|
|
Depreciation and amortization
|
|
|
57
|
|
|
|
57
|
|
|
Unrealized gain on derivative instruments and related transactions
|
|
|
(4,266
|
)
|
|
|
(39,886
|
)
|
|
Effects of economic hedging related to natural gas inventory
|
|
|
(16,228
|
)
|
|
|
23,972
|
|
|
Financial margin
|
|
$
|
19,008
|
|
|
$
|
72,581
|
|
|
(1)
|
Excludes selling, general and administrative expenses of $0.4
million and $(2.3) million for the three months ended December 31, 2023 and 2022, respectively.
|
|
A reconciliation of net income, the closest GAAP financial measure, to net financial earnings is as
follows:
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
23,933
|
|
|
$
|
64,561
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
Unrealized gain on derivative instruments and related transactions
|
|
|
(4,266
|
)
|
|
|
(39,886
|
)
|
|
Tax effect
|
|
|
1,013
|
|
|
|
9,479
|
|
|
Effects of economic hedging related to natural gas
|
|
|
(16,228
|
)
|
|
|
23,972
|
|
|
Tax effect
|
|
|
3,857
|
|
|
|
(5,697
|
)
|
|
NFE tax adjustment
|
|
|
(478
|
)
|
|
|
104
|
|
|
Net financial earnings
|
|
$
|
7,831
|
|
|
$
|
52,533
|
|
FINANCIAL STATISTICS BY BUSINESS UNIT
(Unaudited)
| |
|
Three Months Ended
December 31,
|
|
|
(Thousands, except per share data)
|
|
2023
|
|
|
2022
|
|
|
NEW JERSEY RESOURCES
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
Operating Revenues
|
|
|
|
|
|
|
|
Natural Gas Distribution
|
|
$
|
293,430
|
|
|
$
|
357,746
|
|
|
Clean Energy Ventures
|
|
|
35,295
|
|
|
|
12,792
|
|
|
Energy Services
|
|
|
99,668
|
|
|
|
321,782
|
|
|
Storage and Transportation
|
|
|
23,862
|
|
|
|
26,838
|
|
|
Home Services and Other
|
|
|
14,834
|
|
|
|
14,266
|
|
|
Sub-total
|
|
|
467,089
|
|
|
|
733,424
|
|
|
Eliminations
|
|
|
121
|
|
|
|
(9,857
|
)
|
|
Total
|
|
$
|
467,210
|
|
|
$
|
723,567
|
|
| |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
Operating Income (Loss)
|
|
|
|
|
|
|
|
|
|
Natural Gas Distribution
|
|
$
|
74,175
|
|
|
$
|
80,113
|
|
|
Clean Energy Ventures
|
|
|
18,323
|
|
|
|
(321
|
)
|
|
Energy Services
|
|
|
34,337
|
|
|
|
87,315
|
|
|
Storage and Transportation
|
|
|
7,324
|
|
|
|
12,617
|
|
|
Home Services and Other
|
|
|
(208
|
)
|
|
|
51
|
|
|
Sub-total
|
|
|
133,951
|
|
|
|
179,775
|
|
|
Eliminations
|
|
|
1,868
|
|
|
|
(6,986
|
)
|
|
Total
|
|
$
|
135,819
|
|
|
$
|
172,789
|
|
| |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
Equity in Earnings of Affiliates
|
|
|
|
|
|
|
|
|
|
Storage and Transportation
|
|
$
|
993
|
|
|
$
|
909
|
|
|
Eliminations
|
|
|
667
|
|
|
|
37
|
|
|
Total
|
|
$
|
1,660
|
|
|
$
|
946
|
|
| |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
Net Income (Loss)
|
|
|
|
|
|
|
|
|
|
Natural Gas Distribution
|
|
$
|
51,444
|
|
|
$
|
54,664
|
|
|
Clean Energy Ventures
|
|
|
10,522
|
|
|
|
(3,582
|
)
|
|
Energy Services
|
|
|
23,933
|
|
|
|
64,561
|
|
|
Storage and Transportation
|
|
|
3,640
|
|
|
|
6,243
|
|
|
Home Services and Other
|
|
|
(600
|
)
|
|
|
(29
|
)
|
|
Sub-total
|
|
|
88,939
|
|
|
|
121,857
|
|
|
Eliminations
|
|
|
472
|
|
|
|
(5,936
|
)
|
|
Total
|
|
$
|
89,411
|
|
|
$
|
115,921
|
|
| |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
Net Financial Earnings (Loss)
|
|
|
|
|
|
|
|
|
|
Natural Gas Distribution
|
|
$
|
51,444
|
|
|
$
|
54,664
|
|
|
Clean Energy Ventures
|
|
|
10,522
|
|
|
|
(3,582
|
)
|
|
Energy Services
|
|
|
7,831
|
|
|
|
52,533
|
|
|
Storage and Transportation
|
|
|
3,640
|
|
|
|
6,243
|
|
|
Home Services and Other
|
|
|
(600
|
)
|
|
|
(29
|
)
|
|
Sub-total
|
|
|
72,837
|
|
|
|
109,829
|
|
|
Eliminations
|
|
|
(393
|
)
|
|
|
455
|
|
|
Total
|
|
$
|
72,444
|
|
|
$
|
110,284
|
|
| |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
Throughput (Bcf)
|
|
|
|
|
|
|
|
|
|
NJNG, Core Customers
|
|
|
23.4
|
|
|
|
25.0
|
|
|
NJNG, Off System/Capacity Management
|
|
|
27.2
|
|
|
|
17.9
|
|
|
Energy Services Fuel Mgmt. and Wholesale Sales
|
|
|
30.1
|
|
|
|
44.2
|
|
|
Total
|
|
|
80.7
|
|
|
|
87.1
|
|
| |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
Common Stock Data
|
|
|
|
|
|
|
|
|
|
Yield at December 31,
|
|
|
3.8
|
%
|
|
|
3.1
|
%
|
|
Market Price at December 31,
|
|
$
|
44.58
|
|
|
$
|
49.62
|
|
|
Shares Out. at December 31,
|
|
|
98,202
|
|
|
|
96,803
|
|
|
Market Cap. at December 31,
|
|
$
|
4,377,857
|
|
|
$
|
4,803,389
|
|
|
(Unaudited)
|
|
Three Months Ended
December 31,
|
|
|
(Thousands, except customer and weather data)
|
|
2023
|
|
|
2022
|
|
|
NATURAL GAS DISTRIBUTION
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
Utility Gross Margin
|
|
|
|
|
|
|
|
Operating revenues
|
|
$
|
293,430
|
|
|
$
|
357,746
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
Natural gas purchases
|
|
|
118,444
|
|
|
|
184,771
|
|
|
Operating and maintenance (1)
|
|
|
26,401
|
|
|
|
26,294
|
|
|
Regulatory rider expense
|
|
|
19,189
|
|
|
|
18,251
|
|
|
Depreciation and amortization
|
|
|
26,917
|
|
|
|
24,890
|
|
|
Gross margin
|
|
|
102,479
|
|
|
|
103,540
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
Operating and maintenance (1)
|
|
|
26,401
|
|
|
|
26,294
|
|
|
Depreciation and amortization
|
|
|
26,917
|
|
|
|
24,890
|
|
|
Total Utility Gross Margin
|
|
$
|
155,797
|
|
|
$
|
154,724
|
|
|
(1)
|
Excludes selling, general and administrative expenses of $28.3 million and $23.4 million for the three
months ended December 31, 2023 and 2022, respectively.
|
|
Utility Gross Margin, Operating Income and Net Income
|
|
|
|
|
|
|
|
|
|
Residential
|
|
$
|
108,037
|
|
|
$
|
104,018
|
|
|
Commercial, Industrial & Other
|
|
|
20,831
|
|
|
|
20,779
|
|
|
Firm Transportation
|
|
|
20,764
|
|
|
|
20,480
|
|
|
Total Firm Margin
|
|
|
149,632
|
|
|
|
145,277
|
|
|
Interruptible
|
|
|
784
|
|
|
|
761
|
|
|
Total System Margin
|
|
|
150,416
|
|
|
|
146,038
|
|
|
Off System/Capacity Management/FRM/Storage Incentive
|
|
|
5,381
|
|
|
|
8,686
|
|
|
Total Utility Gross Margin
|
|
|
155,797
|
|
|
|
154,724
|
|
|
Operation and maintenance expense
|
|
|
54,705
|
|
|
|
49,721
|
|
|
Depreciation and amortization
|
|
|
26,917
|
|
|
|
24,890
|
|
|
Operating Income
|
|
$
|
74,175
|
|
|
$
|
80,113
|
|
| |
|
|
|
|
|
|
|
|
|
Net Income
|
|
$
|
51,444
|
|
|
$
|
54,664
|
|
| |
|
|
|
|
|
|
|
|
|
Net Financial Earnings
|
|
$
|
51,444
|
|
|
$
|
54,664
|
|
| |
|
|
|
|
|
|
|
|
|
Throughput (Bcf)
|
|
|
|
|
|
|
|
|
|
Residential
|
|
|
13.9
|
|
|
|
14.7
|
|
|
Commercial, Industrial & Other
|
|
|
2.6
|
|
|
|
2.7
|
|
|
Firm Transportation
|
|
|
3.6
|
|
|
|
4.0
|
|
|
Total Firm Throughput
|
|
|
20.1
|
|
|
|
21.4
|
|
|
Interruptible
|
|
|
3.3
|
|
|
|
3.6
|
|
|
Total System Throughput
|
|
|
23.4
|
|
|
|
25.0
|
|
|
Off System/Capacity Management
|
|
|
27.2
|
|
|
|
17.9
|
|
|
Total Throughput
|
|
|
50.6
|
|
|
|
42.9
|
|
| |
|
|
|
|
|
|
|
|
|
Customers
|
|
|
|
|
|
|
|
|
|
Residential
|
|
|
523,623
|
|
|
|
514,452
|
|
|
Commercial, Industrial & Other
|
|
|
32,872
|
|
|
|
32,302
|
|
|
Firm Transportation
|
|
|
22,989
|
|
|
|
25,628
|
|
|
Total Firm Customers
|
|
|
579,484
|
|
|
|
572,382
|
|
|
Interruptible
|
|
|
83
|
|
|
|
88
|
|
|
Total System Customers
|
|
|
579,567
|
|
|
|
572,470
|
|
|
Off System/Capacity Management*
|
|
|
33
|
|
|
|
30
|
|
|
Total Customers
|
|
|
579,600
|
|
|
|
572,500
|
|
|
*The number of customers represents those active during the last month of the period.
|
|
|
|
|
|
|
|
|
|
Degree Days
|
|
|
|
|
|
|
|
|
|
Actual
|
|
|
1,408
|
|
|
|
1,543
|
|
|
Normal
|
|
|
1,534
|
|
|
|
1,547
|
|
|
Percent of Normal
|
|
|
91.8
|
%
|
|
|
99.7
|
%
|
|
(Unaudited)
|
|
Three Months Ended
December 31,
|
|
|
(Thousands, except customer, RECs and megawatt)
|
|
2023
|
|
|
2022
|
|
|
CLEAN ENERGY VENTURES
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
Operating Revenues
|
|
|
|
|
|
|
|
SREC sales
|
|
$
|
25,931
|
|
|
$
|
3,886
|
|
|
TREC sales
|
|
|
2,403
|
|
|
|
1,202
|
|
|
SREC II sales (1)
|
|
|
247
|
|
|
|
185
|
|
|
Solar electricity sales
|
|
|
3,654
|
|
|
|
4,582
|
|
|
Sunlight Advantage
|
|
|
3,060
|
|
|
|
2,937
|
|
|
Total Operating Revenues
|
|
$
|
35,295
|
|
|
$
|
12,792
|
|
|
Depreciation and Amortization
|
|
$
|
6,922
|
|
|
$
|
5,576
|
|
| |
|
|
|
|
|
|
|
|
|
Operating Income (Loss)
|
|
$
|
18,323
|
|
|
$
|
(321
|
)
|
| |
|
|
|
|
|
|
|
|
|
Income Tax Provision (Benefit)
|
|
$
|
3,131
|
|
|
$
|
(1,837
|
)
|
| |
|
|
|
|
|
|
|
|
|
Net Income (Loss)
|
|
$
|
10,522
|
|
|
$
|
(3,582
|
)
|
| |
|
|
|
|
|
|
|
|
|
Net Financial Earnings (Loss)
|
|
$
|
10,522
|
|
|
$
|
(3,582
|
)
|
| |
|
|
|
|
|
|
|
|
|
Solar Renewable Energy Certificates Generated
|
|
|
93,570
|
|
|
|
98,462
|
|
| |
|
|
|
|
|
|
|
|
|
Solar Renewable Energy Certificates Sold
|
|
|
122,439
|
|
|
|
16,812
|
|
| |
|
|
|
|
|
|
|
|
|
Transition Renewable Energy Certificates Generated
|
|
|
16,705
|
|
|
|
8,345
|
|
| |
|
|
|
|
|
|
|
|
|
Solar Renewable Energy Certificates II Generated
|
|
|
2,773
|
|
|
|
1,784
|
|
| |
|
|
|
|
|
|
|
|
|
Solar Megawatts Under Construction
|
|
|
34.3
|
|
|
|
45.5
|
|
|
(1) Prior year SREC II revenue was previously included in Solar electricity sales and other
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
ENERGY SERVICES
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
Operating Income
|
|
|
|
|
|
|
|
|
|
Operating revenues
|
|
$
|
99,668
|
|
|
$
|
321,782
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
Gas purchases
|
|
|
60,166
|
|
|
|
233,287
|
|
|
Operation and maintenance expense
|
|
|
5,108
|
|
|
|
1,123
|
|
|
Depreciation and amortization
|
|
|
57
|
|
|
|
57
|
|
|
Operating Income
|
|
$
|
34,337
|
|
|
$
|
87,315
|
|
| |
|
|
|
|
|
|
|
|
|
Net Income
|
|
$
|
23,933
|
|
|
$
|
64,561
|
|
| |
|
|
|
|
|
|
|
|
|
Financial Margin
|
|
$
|
19,008
|
|
|
$
|
72,581
|
|
| |
|
|
|
|
|
|
|
|
|
Net Financial Earnings
|
|
$
|
7,831
|
|
|
$
|
52,533
|
|
| |
|
|
|
|
|
|
|
|
|
Gas Sold and Managed (Bcf)
|
|
|
30.1
|
|
|
|
44.2
|
|
| |
|
|
|
|
|
|
|
|
|
STORAGE AND TRANSPORTATION
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
Operating Revenues
|
|
$
|
23,862
|
|
|
$
|
26,838
|
|
| |
|
|
|
|
|
|
|
|
|
Equity in Earnings of Affiliates
|
|
$
|
993
|
|
|
$
|
909
|
|
| |
|
|
|
|
|
|
|
|
|
Operation and Maintenance Expense
|
|
$
|
10,100
|
|
|
$
|
7,474
|
|
| |
|
|
|
|
|
|
|
|
|
Other Income, Net
|
|
$
|
2,288
|
|
|
$
|
1,367
|
|
| |
|
|
|
|
|
|
|
|
|
Interest Expense
|
|
$
|
5,933
|
|
|
$
|
6,707
|
|
| |
|
|
|
|
|
|
|
|
|
Income Tax Provision
|
|
$
|
1,032
|
|
|
$
|
1,943
|
|
| |
|
|
|
|
|
|
|
|
|
Net Income
|
|
$
|
3,640
|
|
|
$
|
6,243
|
|
| |
|
|
|
|
|
|
|
|
|
Net Financial Earnings
|
|
$
|
3,640
|
|
|
$
|
6,243
|
|
| |
|
|
|
|
|
|
|
|
|
HOME SERVICES AND OTHER
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
Operating Revenues
|
|
$
|
14,834
|
|
|
$
|
14,266
|
|
| |
|
|
|
|
|
|
|
|
|
Operating (Loss) Income
|
|
$
|
(208
|
)
|
|
$
|
51
|
|
| |
|
|
|
|
|
|
|
|
|
Net Loss
|
|
$
|
(600
|
)
|
|
$
|
(29
|
)
|
| |
|
|
|
|
|
|
|
|
|
Net Financial Loss
|
|
$
|
(600
|
)
|
|
$
|
(29
|
)
|
| |
|
|
|
|
|
|
|
|
|
Total Service Contract Customers at Dec 31
|
|
|
100,840
|
|
|
|
102,600
|
|