Northwestern Energy Group, Inc. · NASDAQ:NWE
Northwestern Energy — Q3 2025 Earnings Presentation
56 slides from Northwestern Energy's earnings presentation, Oct 30, 2025
Slide 1: Third Quarter Earnings Webinar
Third Quarter Earnings Webinar October 30, 2025 8-K Date: October 30, 2025
Slide 2: Forward-Looking Statements
Forward-Looking Statements 2 Information in this communication, other than statements of historical facts, may constitute forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These
Slide 3: NorthWestern Energy
NorthWestern Energy 3 NorthWestern Energy Group, Inc. dba: NorthWestern Energy Ticker: NWE (Nasdaq) www.northwesternenergy.com Corporate Support Office 3010 West 69th Street Sioux Falls, SD 57108 (605) 978-2900 Director - Corporate Development & Investor Relations Officer Travis Meyer 605-978-2967 t
Slide 4: Recent Highlights
Recent Highlights ✓ Reported GAAP diluted EPS of $0.62 o Non-GAAP diluted EPS of $0.791 ✓ Affirming 2025 earnings guidance range of $3.53 - $3.652 ✓ Integrated Energy West natural gas assets, customers, and employees ✓ Announced Agreement with Black Hills Corporation for an all-stock Merger of Equal
Slide 5: The NorthWestern Value Proposition
8% to 11% Total Return >11% Total Return Incremental Opportunities: > 6% EPS Growth Approximately 4% to 5% Dividend Yield Base Capital Plan: 4% to 6% EPS Growth ✓ Data centers & new large load opportunities ✓ FERC Regional Transmission ✓ Incremental generating capacity (subject to successful resourc
Slide 6: Third Quarter Financial Review
Thank youThird Quarter Financial Review 6
Slide 7: Third Quarter Financial Results
Third Quarter Financial Results 7 1.) Utility Margin is a non- GAAP Measure. See appendix slide titled “Reconciling Gross Margin to Utility Margin” for additional disclosure. Note: Subtotal variances may exist due to rounding.
Slide 8: Third Quarter 2025 Financial Results
Third Quarter 2025 Financial Results 8 1.) See “Third Quarter 2025 Non-GAAP Earnings” and “Non-GAAP Financial Measures” slides that follow. Third Quarter Net Income vs Prior Period • GAAP: $8.6 million or -18.4% • Non-GAAP1: $8.7 million or 21.9% Third Quarter EPS vs Prior Period • GAAP: $0.14 or -1
Slide 9: Year-to-Date September 2025 Financial Results
Year-to-Date September 2025 Financial Results 9 1.) See “Year-to-Date 2025 Non-GAAP Earnings” and “Non-GAAP Financial Measures” slides that follow. Year-to-Date Net Income vs Prior Period • GAAP: $7.2 million or -5.0% • Non-GAAP1: $8.8 million or 6.3% Year-to-Date EPS vs Prior Period • GAAP: $0.12 o
Slide 10: Third Quarter Earnings Drivers
Third Quarter Earnings Drivers 10 The decrease in GAAP diluted EPS during the quarter is primarily due to higher operating expenses, including merger-related costs, and a prior year safe harbor method change, partly offset by an improvement in Utility Margin. After-Tax EPS vs Prior Year 1.) Utility
Slide 11: Third Quarter Utility Margin Bridge
Third Quarter Utility Margin Bridge Pre-Tax Millions vs. Prior Year $34.2 million or 13.3% increase in Utility Margin items that impact Net Income Note: Utility Margin is a non-GAAP measure. See appendix slide titled “Reconciling Gross Margin to Utility Margin” for additional disclosure. 11
Slide 12: Third Quarter 2025 Non-GAAP Earnings
We estimate weather to be a $3.5 million pre-tax detriment as compared to normal and a $3.1 million detriment as compared to third quarter 2024. (1) As a result of the adoption of Accounting Standard Update 2017-07 in March 2018, pension and other employee benefit expense is now disaggregated on the
Slide 13: Credit, Cash Flow, and Financing Plans
Credit, Cash Flow, and Financing Plans 13 FFO: Cash from Operations less Working Capital Adjustments. Debt: Long- & Short-term Debt (including unamortized debt issuance costs and pension liability). S&P upgraded outlook to Positive1, Moody’s and Fitch remain Stable. No equity expected to fund the cu
Slide 14: Affirming 2025 Non-GAAP EPS Guidance
14 Affirming 2025 Non-GAAP EPS Guidance1 of $3.53 - $3.65 per diluted share ✓ Affirming long-term growth rates from 2024 base2 • EPS growth of 4% to 6% • Rate base growth of 4% to 6% • Continued focus on closing the gap between earned & authorized returns ✓ No equity expected to fund the current 5-y
Slide 15: 2025 Earnings Bridge
15 2025 Earnings Bridge This guidance range is based upon, but not limited to, the following major assumptions: • Final approval of all material aspects of NorthWestern's settlement position in the currently pending Montana general rate review; • Normal weather in our service territories; • Excludes
Slide 16: Regulated Utility Five-Year Capital Forecast
$2.74 billion of highly-executable and low-risk critical capital investment Regulated Utility Five-Year Capital Forecast (millions) 16
Slide 17: Other Updates
Thank youOther Updates 17
Slide 18: Merger with Black Hills Update
Merger with Black Hills Update 18 ✓ In October, filed joint applications for transaction approval with regulatory commissions in Montana, Nebraska, and South Dakota
Slide 19: Large Load Customers
✓ Montana ▪ Expected to be served by overall utility portfolio, which is projected to be long capacity beginning in 2026 ▪ Current generating portfolio over 60% carbon free ▪ We anticipate making a filing with the MPSC to propose a large load tariff in the fourth quarter of 2025 ✓ South Dakota ▪ Sig
Slide 20: Data Center Process (Montana & South Dakota)
20 Data Center Process (Montana & South Dakota) Data Center Request • Load & Location • Supply Potential • Customer/Developer Required Timing Queue Count: 7 High-Level Assessment • Viability Assessment • SPP Screening • High Level Cost Estimate Queue Count: 7 Energy Service Agreement (ESA) • Regulat
Slide 21: Colstrip Transaction Overview
Colstrip Transaction Overview 21 Announcement: Effective Date: Capacity: Acquisition Price: Status Update: Puget July 2024 December 31, 2025 370 MW (185 MW each of units 3 & 4) $0.0 Anticipate signing contract in Q4 2025 to sell electricity through late 2027. Revenue from the contract is expected to
Slide 22: Conclusion
Conclusion Pure Electric & Gas Utility Solid Utility Foundation Best Practices Corporate Governance Attractive Future Growth Prospects Strong Earnings & Cash Flows 22 The pending merger with Black Hills Corporation will combine the strengths of both companies, resulting in an organization with great
Slide 23: Appendix
Thank youAppendix: 23
Slide 24: Rate Base and Authorized Returns
(1) The revenue requirement associated with the FERC regulated portion of Montana electric transmission and ancillary services are included as revenue credits to our MPSC jurisdictional customers. Therefore, we do not separately reflect FERC authorized rate base or authorized returns. (2) The Montan
Slide 25: Montana Electric Rate Review
25 Montana Electric Rate Review MPSC approval of the partial Joint Party Settlement, along with NorthWestern’s proposals for YCGS and PCCAM, would allow for recovery of increased operating costs and an opportunity to earn a fair return on the investment that funds the critical energy infrastructure
Slide 26: Montana Natural Gas Rate Review
Key Dates • 6/9/25 - 6/18/25: MPSC Public Hearings • 7/2/25: Interim rates remain in place as implemented Dec. 1, 2024 ($17.4 million subject to refund) • 7/21/25: NWE opening brief submitted • 8/11/25: Intervenor response briefs submitted • 8/26/25: NWE response submitted • Final order expected dur
Slide 27: Montana Wildfire Bill
27 Montana Wildfire Bill No Strict Liability: • Confirms strict liability cannot be applied to utility operations related to wildfire Legal Protections for Providers: • Negligence standard based on Montana specific circumstances • Rebuttable presumption utility acted reasonably if it substantially f
Slide 28: Transmission Bill
28 Transmission Bill Allows Certificate of Public Convenience & Necessity (CPCN) for electric transmission to be issued by the Montana Public Service Commission (MPSC) • Greater confidence of fair and equitable return Bill allows greater confidence for investors providing the critical capital necess
Slide 29: Regional Transmission Opportunities
29 Regional Transmission Opportunities Colstrip Transmission System North Plains Connector (NPC) Consortium Project • $3.6 billion, 415-mile, high-voltage direct-current transmission line connecting to Montana's Colstrip substation, bridging the eastern and western U.S. energy grids • Project awarde
Slide 30: Third Quarter Appendix
Thank youThird Quarter Appendix 30
Slide 31: Third Quarter Financial Results
Third Quarter Financial Results 31 1.) Utility Margin is a non- GAAP Measure. See appendix slide titled “Reconciling Gross Margin to Utility Margin” for additional disclosure. Note: Subtotal variances may exist due to rounding. Appendix
Slide 32: Utility Margin (Q3)
Utility Margin (Q3) ($ in millions) Three Months Ended September 30, 2025 2024 Variance Electric $ 262.6 $ 225.7 $ 36.9 16.3% Natural Gas 37.5 31.6 5.9 18.7% Total Utility Margin1 $ 300.1 $ 257.3 $ 42.8 16.6% (1) Utility Margin is a non-GAAP Measure. See appendix slide titled “Reconciling Gross Marg
Slide 33: Operating Expenses (Q3)
Operating Expenses (Q3) Increase in operating expenses due to the following factors: $ 7.6 Merger-related costs, including consulting and legal fees 5.8 Depreciation expense due to plant additions and higher depreciation rates 3.8 Wildfire mitigation expense, partly offset by higher base revenues 1.
Slide 34: Operating to Net Income (Q3)
Operating to Net Income (Q3) ($ in millions) Three Months Ended September 30, 2025 2024 Variance Operating Income $ 80.3 $ 67.9 $ 12.4 18.3% Interest expense, net (38.4) (33.4) 5.0 15.0% Other income, net 5.1 9.1 (4.0) (44.0%) Income Before Income Taxes 47.0 43.7 3.3 7.6% Income tax (expense) benefi
Slide 35: Tax Reconciliation (Q3)
Tax Reconciliation (Q3) 35 Appendix
Slide 36: Segment Results (Q3)
Segment Results (Q3) 36 Appendix *Direct transmission expense excludes depreciation and depletion. (1) Utility Margin is a non-GAAP Measure. See appendix slide titled “Reconciling Gross Margin to Utility Margin” for additional disclosure. (1) Consists of unallocated corporate costs, including merger
Slide 37: Electric Segment (Q3)
Electric Segment (Q3) (1) Included within this line is our lighting customer class, for which we have historically counted each lighting district as one customer. We have retroactively modified our customer counts to now reflect each lighting service as a customer as that better aligns with the MWH
Slide 38: Natural Gas Segment (Q3)
Natural Gas Segment (Q3) 38 Appendix (1) Utility Margin is a non-GAAP Measure. See appendix slide titled “Reconciling Gross Margin to Utility Margin” for additional disclosure.
Slide 39: 2025 Year-to-Date Appendix
Thank you2025 Year-to-Date Appendix 39
Slide 40: Year-to-Date 2025 Non-GAAP Earnings
We estimate weather to be a $3.8 million pre-tax detriment as compared to normal and a $1.5 million detriment as compared to the nine months ending third quarter 2024. (1) As a result of the adoption of Accounting Standard Update 2017-07 in March 2018, pension and other employee benefit expense is n
Slide 41: Year-to-Date Financial Results
Year-to-Date Financial Results 41 1.) Utility Margin is a non- GAAP Measure. See appendix slide titled “Reconciling Gross Margin to Utility Margin” for additional disclosure. Note: Subtotal variances may exist due to rounding. Appendix
Slide 42: Utility Margin (YTD)
Utility Margin (YTD) ($ in millions) Nine Months Ended September 30, 2025 2024 Variance Electric $ 725.2 $ 652.8 $ 72.4 11.1% Natural Gas 170.7 148.5 22.2 14.9% Total Utility Margin1 $ 895.9 $ 801.3 $ 94.6 11.8% (1) Utility Margin is a non-GAAP Measure. See appendix slide titled “Reconciling Gross M
Slide 43: Operating Expenses (YTD)
Operating Expenses (YTD) Increase in operating expenses due to the following factors: $ 17.0 Depreciation expense due to plant additions and higher depreciation rates 8.5 Electric generation maintenance 7.6 Merger-related costs, including consulting and legal fees 7.3 Insurance expense, primarily du
Slide 44: Operating to Net Income (YTD)
Operating to Net Income (YTD) ($ in millions) Nine Months Ended September 30, 2025 2024 Variance Operating Income $ 265.8 $ 231.6 $ 34.2 14.8% Interest expense, net (111.1) (96.3) 14.8 15.4% Other income, net 9.1 19.6 (10.5) (53.6%) Income Before Income Taxes 163.8 155.0 8.8 5.7% Income tax expense
Slide 45: Tax Reconciliation (YTD)
Tax Reconciliation (YTD) 45 Appendix
Slide 46: Segment Results (YTD)
Segment Results (YTD) 46 Appendix *Direct transmission expense excludes depreciation and depletion. (1) Utility Margin is a non-GAAP Measure. See appendix slide titled “Reconciling Gross Margin to Utility Margin” for additional disclosure. (2) Consists of unallocated corporate costs, including merge
Slide 47: Electric Segment (YTD)
Electric Segment (YTD) (1) Included within this line is our lighting customer class, for which we have historically counted each lighting district as one customer. We have retroactively modified our customer counts to now reflect each lighting service as a customer as that better aligns with the MWH
Slide 48: Natural Gas Segment (YTD)
Natural Gas Segment (YTD) 48 Appendix (1) Utility Margin is a non-GAAP Measure. See appendix slide titled “Reconciling Gross Margin to Utility Margin” for additional disclosure.
Slide 49: Year-to-Date Cash Flow
Cash from Operating Activities decreased by $5.6 million primarily due to merger transaction costs, lower collections of accounts receivable balances due to timing of colder weather, and an increase in our net cash outflows for energy supply costs, as shown in the table below, partly offset by the p
Slide 50: Balance Sheet
Balance Sheet 50 Appendix Debt to Total Capitalization up from last quarter and inside our targeted 50% - 55% range.
Slide 51: Reconciling Gross Margin to Utility Margin
Reconciling Gross Margin to Utility Margin Management believes that Utility Margin provides a useful measure for investors and other financial statement users to analyze our financial performance in that it excludes the effect on total revenues caused by volatility in energy costs and associated reg
Slide 52: PCCAM Impact by Quarter
PCCAM Impact by Quarter Qualified Facility Earnings Adjustment Our electric QF liability consists of unrecoverable costs associated with contracts covered under PURPA that are part of a 2002 stipulation with the MPSC and other parties. Risks / losses associated with these contracts are born by share
Slide 53: Non-GAAP Financial Measures
Non-GAAP Financial Measures 53 Appendix Pre-Tax Adjustments ($ Millions) 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Reported GAAP Pre-Tax Income 181.2$ 156.5$ 176.1$ 178.3$ 182.2$ 144.2$ 190.2$ 182.4$ 201.6$ 214.7$ Non-GAAP Adjustments to Pre-Tax Income: Weather 13.2 15.2 (3.4) (1.3) (7.3) 9.
Slide 54: Non-GAAP Financial Measures
Non-GAAP Financial Measures This presentation includes financial information prepared in accordance with GAAP, as well as other financial measures, such as Utility Margin, Adjusted Non-GAAP pretax income, Adjusted Non-GAAP net income and Adjusted Non-GAAP Diluted EPS that are considered “non-GAAP fi
Slide 55: Additional Merger Related Disclosures
Additional Merger Related Disclosures 55 Appendix No Offer or Solicitation This document is for informational purposes only and is not intended to and shall not constitute an offer to buy or sell or the solicitation of an offer to buy or sell any securities, or a solicitation of any vote or approval
Slide 56: Thank you
Thank youDelivering a bright future 56
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