Slide 1: Investor Presentation: FY 2023 Third Quarter and YTD Financial Results
August 2023 Investor Presentation FY 2023 Third Quarter and YTD Financial Results August 3, 2023
Slide 2: Forward-Looking Statements and Non-GAAP Measures
Forward-Looking Statements and Non-GAAP Measures Forward-Looking Statements This presentation 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 Li
Slide 3: Contents
Contents FY 2023 Third Quarter and YTD 3 Agenda 4 Fiscal 2023 Third Quarter and Year-to-Date Summary 5 Re-Affirming Fiscal 2023 NFEPS Guidance of $2.62 to $2.72 6 New Jersey Natural Gas 7 Clean Energy Ventures (CEV) 8 Financial Review 9 Review of Fiscal 2023 Q3 and YTD NFE Changes 10 Capital Plan 11
Slide 4: FY 2023 Third Quarter Conference Call Agenda
FY 2023 Third Quarter Conference Call Agenda 1 Third Quarter FY 2023 Highlights Steve Westhoven | President and CEO 2 Financial Highlights Roberto Bel | SVP and CFO 3 Q&A Session 3
Slide 5: Fiscal 2023 Third Quarter and Year-to-Date Summary
Fiscal 2023 Third Quarter and Year-to-Date Summary Consistent Performance Throughout All Business Units Third Quarter NFEPS1 $0.10 NJNG CEV S&T Energy Services -$0.04 Strong new customer Increased capacity by Significant year-over- Continued contribution 3Q22 3Q23 growth ~75MW in fiscal 2023 year re
Slide 6: Fiscal 2023 NFEPS Guidance of $2.62 to $2.72 Re-Affirmed
Fiscal 2023 NFEPS Guidance of $2.62 to $2.72 Re-Affirmed Guidance Raised by $0.20 in Q1 FY2023; Represents 8.1% Increase from Midpoint of FY 2023 Initial Guidance Range Net Financial Earnings per Share Fiscal 2023 NFEPS Guidance by Segment $2.62 - $2.72 7-9% LONG-TERM CEV $2.50 ANNUAL GROWTH1 18% -
Slide 7: New Jersey Natural Gas
New Jersey Natural Gas Strong Trend of Favorable Customer Growth Added 5,892 new customers YTD in fiscal YTD Fiscal 2023 Capital Expenditures1 NJNG Customers 2023 compared to 5,274 (in thousands) 580 in YTD fiscal 2022 ~40% of capital expenditures earning a near real-time return 570 New Customer 560
Slide 8: Clean Energy Ventures (CEV)
Clean Energy Ventures (CEV) CEV owns and operates solar projects with approximately 462MW of capacity MWs In Service Total 1200 Under Construction ~1.2 GW Under Contract or Exclusivity 306 1000 Pipeline of ~757MW 800 ~75MW New In-Service in Fiscal 2023 368 including projects under construction, cont
Slide 9: Financial Review
Financial Review Roberto Bel SVP and Chief Financial Officer 88
Slide 10: Review of Fiscal 2023 Q3 and YTD NFE Changes
Review of Fiscal 2023 Q3 and YTD NFE Changes ($ in Millions) Fiscal 2023 Q3 Fiscal 2023 YTD Fiscal 3Q22 – Consolidated NFE ($ in millions) $ (3.6) Fiscal 2022 YTD – Consolidated NFE ($ in millions) $ 192.4 NJNG $ (1.8) NJNG $ (0.3) Utility Gross Margin1 $ 5.8 Utility Gross Margin1 $ 28.3 O&M $ (6.7)
Slide 11: Capital Plan
Capital Plan1 ($ in Millions) Capital plan supports long-term NFEPS growth targets of 7 – 9% $529 $712 $622 $545 - $633 $542 - $728 $124 $35 - $43 (from $20 - $28) $2 - $8 $89 $142 $43 $100 - $150 $140 - $280 (from $100 - $200) $124 $145 $499 $410 - $440 $400 - $440 (from $400 - $430) $362 $335 FY20
Slide 12: Projected Cash Flows
Projected Cash Flows ($ in Millions) Increased from $320 - $360 in last quarterly conference call) FY2022A FY2023E FY2024E Cash Flow from Operations $324 $400 - $420 $450 - $490 Uses of Funds Capital Expenditures1 $590 $491 - $575 $489 - $671 Dividends2 $128 $132 - $137 $143 - $148 Total Uses of Fun
Slide 13: Investment Grade Profile
Investment Grade Profile Strong Credit Ratings Supported by Stable Cash Flows NJR Adjusted FFO / Adjusted Debt1 Current Credit Ratings 25% NJNG NJR Increased from (Secured (Unsecured 17-18% in last quarterly Rating) Rating) conference call) NAIC NAIC-1.E NAIC-2.A Moody's A1 (Stable) 20% 19-20% Fitch
Slide 14: Alignment with New Jersey's Clean Energy Policy Landscape
Alignment with New Jersey’s Clean Energy Policy Landscape 2019 NJR Environmental Initiatives The Energy Master Plan (EMP) SAVEGREEN Maximize energy efficiency and conservation established priorities for the use, management and development of CEV expansion Accelerate the use of renewable energy energ
Slide 15: Key Takeaways: Fiscal 2023 Year-to-Date
Key Takeaways: Fiscal 2023 Year-to-Date Implementing Strategic Plan to Drive Continued Organic Growth Across Portfolio Reiterates FY 2023 NFE Guidance $2.62 - $2.72 Raised by $0.20 in Q1 2023 Highest Long-Term Growth Rate Across LDC Peer Group 7 – 9% Defined Capital Plan $1.1 - $1.4 Billion Expected
Slide 16: Appendix: Financial Statements and Additional Information
Appendix: Financial Statements and Additional Information 16 Reconciliation of NFE and NFEPS to Net Income 17 Other Reconciliation of Non-GAAP Measures 18 Reconciliation of Adjusted Funds from Operations to Cash Flow from Operations 19 Fiscal 2023 Third Quarter and YTD NFE by Business Unit 20 Clean
Slide 17: Reconciliation of NFE and NFEPS to Net Income
Reconciliation of NFE and NFEPS to Net Income ($ in 000s) (Unaudited) Three Months Ended Nine Months Ended June 30, June 30, 2023 2022 2023 2022 • NFE is a measure of earnings based on the elimination of timing differences to effectively NEW JERSEY RESOURCES match the earnings effects of the economi
Slide 18: Other Reconciliation of Non-GAAP Measures
Other Reconciliation of Non-GAAP Measures ($ in 000s) (Unaudited) Three Months Ended Nine Months Ended June 30, June 30, 2023 2022 2023 2022 A reconciliation of gross margin, the closest GAAP financial measurement, to utility gross margin is as follows: NJNG Utility Gross Margin Operating revenues $
Slide 19: Reconciliation of Adjusted Funds from Operations to Cash Flow from Operations
Reconciliation of Adjusted Funds from Operations to Cash Flow from Operations Adjusted Funds from Operations, Adjusted Debt, FY2022 • Adjusted funds from operations is cash flows FY2022 (Millions) from operating activities, plus components of (Millions) working capital, cash paid for interest (net o
Slide 20: Fiscal 2023 Q3 and YTD NFE by Business Unit
Fiscal 2023 Q3 and YTD NFE by Business Unit ($ in 000s) (Thousands) Three Months Ended June 30, Nine Months Ended June 30, 2023 2022 Change 2023 2022 Change New Jersey Natural Gas $891 $2,648 $(1,757) $156,252 $156,511 $(259) Clean Energy Ventures $7,267 $(5,098) $12,365 $(5,694) $(18,410) $12,716 S
Slide 21: CEV: SREC Hedging Strategy Stabilizes Revenue
CEV: SREC Hedging Strategy Stabilizes Revenue Based on Energy Year1, as of June 30, 2023 Percent Average Current Price Hedged Unhedged Hedged Price (EY) EY 2023 410 24 94% $203 $219 Over 94% hedged EY 2024 395 1 100% $197 $214 through Thousands Energy Year 2024 EY 2025 353 46 89% $190 $202 71% hedge
Slide 22: Capital Plan Table
Capital Plan Table1,2 ($ in Millions) 1Q 2Q 3Q YTD Near Real Time FY2023A FY2023A FY2023A FY2023A FY2022A FY2023E FY2024E Return? New Jersey Natural Gas New Customer $13 $18 $20 $51 $54 $64 - $68 $56 - $60 Yes Maintenance & Integrity $27 $28 $33 $88 $104 $126 - $129 $161 - $176 Cost of Removal / Oth
Slide 23: Dividend Growth: Committed to Building Shareholder Value
Dividend Growth: Committed to Building Shareholder Value Strong Track Record of Dividend Growth Dividends per Share Dividend History $1.56 Highlighted Rows Reflect Changes in Quarterly Cash Dividends Ex-Dividend Date Record Date Payable Date Amount Per Share 06/13/2023 06/14/2023 07/03/2023 $0.39 FY
Slide 24: Well Positioned in a Rising Interest Rate Environment
Well Positioned in a Rising Interest Rate Environment ($ in Millions) Term Debt1 Maturity Schedule Impact of high interest rate as of June 30, 2023 environment included in FY2023 and $160 long-term NFEPS guidance $100 $100 $150 Weighted Average of Maturity ~15.8 $140 $130 $130 $130 • Interest rate i
Slide 25: Total Expected Shareholder Return
Total Expected Shareholder Return Delivering Value to Shareholders Through Growth and Income NJR is a Premier Energy Infrastructure Company The Clean Energy Future Solid Long Term Growth Growing Dividend Starts at NJR Outlook Net Zero by 2050 goal for New Expect 7% - 9% Annualized dividend yield Jer
Slide 26: Environmental, Social and Governance Efforts
Environmental, Social and Governance Efforts Focus on Definable Accomplishments Coastal Climate Initiative in Action • Achieved NJ operational emissions reductions over 55% since 2006 with goal of 60% by 2030 and net zero by 2050 • One of the largest owner-operators of solar assets in New Jersey, we
Slide 27: Shareholder and Online Information
Shareholder and Online Information Stock Transfer Agent and Registrar The Transfer Agent and Registrar for the company’s common stock is Broadridge Corporate Issuer Solutions, Inc. (Broadridge). Shareowners with questions about account activity should contact Broadridge investor relations representa