Newjersey Resources Corporation · NYSE:NJR
Newjersey Resources — Q1 2023 Earnings Presentation
25 slides from Newjersey Resources's earnings presentation, Feb 2, 2023
Slide 1: First Quarter FY 2023 Financial Results
First Quarter FY 2023 Financial Results February 2, 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: Agenda
Agenda 1 First Quarter FY 2023 Highlights Steve Westhoven | President and CEO 2 Financial Highlights Roberto Bel | SVP and CFO 3 Q&A Session 2
Slide 4: 2022 Sustainability Report
2022 Sustainability Report 14th Consecutive Year since 2008 Highlighting our accomplishments: • Invested more than $53 million in NJNG’s energy- efficiency programs in fiscal year 2022, the highest single-year investment of this type in our company’s history • Advanced our leadership in renewable de
Slide 5: First Quarter 2023 Summary
First Quarter 2023 Summary Successful Operations During Winter Storm Elliot First Quarter NFEPS1 Continued Execution Throughout Fall/Winter Quarter $1.14 NJNG CEV S&T Energy Services $0.69 $0.46 Improved NFE by ~7% Placed ~43MW into Adelphia Gateway Stronger than expected $0.38 from the prior year p
Slide 6: Increasing Fiscal 2023 NFEPS Guidance by $0.20 to $2.62 to $2.72
Increasing Fiscal 2023 NFEPS Guidance by $0.20 to $2.62 to $2.72 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% - 20% $2.471 $2.16 $2.251 FY2024 EXPECTED TO
Slide 7: New Jersey Natural Gas
New Jersey Natural Gas Solid Performance Due to Higher Base Rates / Favorable Customer Growth Q1 Fiscal 2023 Capital Expenditures1 NJNG Customers Added 2,132 new customers in Q1 fiscal 2023 (in thousands) compared to 1,730 in Q1 fiscal 2022 580 ~36% of capital 572.5 expenditures 570 earned a near Ma
Slide 8: Clean Energy Ventures (CEV): Growing Capacity with a Robust Pipeline
Clean Energy Ventures (CEV): Growing Capacity with a Robust Pipeline CEV owns and operates solar projects in New Jersey, Rhode Island, New York and Connecticut with approximately 430MW of capacity MWs Total 1200 ~1.1 GW In Service Under Construction Under Contract or Exclusivity 1000 261 Pipeline of
Slide 9: Financial Review
Financial Review Roberto Bel SVP and Chief Financial Officer 8
Slide 10: NJR Review of Q1 Fiscal 2023 NFE Changes
NJR Review of Q1 Fiscal 2023 NFE Changes ($ in Millions) Fiscal 1Q22 – Consolidated NFE ($ in millions) $ 65.8 NJNG $ 3.6 Utility Gross Margin1 $ 21.2 O&M2 $ (13.3) Depreciation & Amortization (D&A) $ (2.0) Interest expense, AFUDC, Income Tax $ (2.3) Clean Energy Ventures $ 3.2 Revenue $ 2.6 O&M $ 1
Slide 11: NJR Capital Plan
NJR Capital Plan1 ($ in Millions) Capital plan supports long-term NFEPS growth targets of 7 – 9% $529 $712 $622 $520 - $658 $542 - $728 $124 $2 - $8 $20 - $28 $89 $142 $43 $140 - $280 $100 - $200 $124 $145 $499 $400 - $430 $400 - $440 $362 $335 FY2020A FY2021A FY2022A FY2023E FY2024E NJNG CEV S&T 1)
Slide 12: Well Positioned in a Rising Interest Rate Environment
Well Positioned in a Rising Interest Rate Environment ($ in Millions) Term Debt Maturity Schedule Impact of high interest rate as of December 31, 2022 environment included in FY2023 and long-term NFEPS guidance $160 $100 $100 $150 Weighted Average of Maturity ~15.8 years • Interest rate impact mitig
Slide 13: Delivering Value to Shareholders Through Growth and Income
Delivering Value to Shareholders Through Growth and Income Implementing Strategic Plan to Drive Continued Organic Growth Across Portfolio NJR is a Premier Energy Infrastructure Company The Clean Energy Future Solid Long Term Growth Growing Dividend Starts at NJR Outlook Net Zero by 2050 goal for New
Slide 14: Appendix
Appendix Slide 14 NJR’s Business Portfolio 15 Storage and Transportation (S&T) 16 Energy Services 17 CEV – SREC Hedging Strategy Stabilizes Revenue 18 First Quarter Fiscal 2023 NFE by Business Unit 19 Reconciliation of NFE and NFEPS to Net Income 20 Other Reconciliation of Non-GAAP Measures 21 NJR C
Slide 15: NJR's Business Portfolio
NJR’s Business Portfolio Natural Gas and Renewable Fuel Distribution; Solar Investments, Wholesale Energy Markets; Storage & Transportation Infrastructure; Retail Operations Operates and maintains approximately 7,700 miles of Natural Gas New Jersey Natural Gas transportation and distribution infrast
Slide 16: Storage and Transportation (S&T)
Storage and Transportation (S&T) Solid Contribution from Leaf River, Steckman Ridge, and Adelphia Gateway during Q1 2023 FULLY OPERATIONAL FULLY OPERATIONAL FULLY OPERATIONAL Description • 32.2 mmdth high deliverability • 12.6 mmdth reservoir storage facility • 0.9 mmdth/d interstate pipeline from N
Slide 17: Energy Services
Energy Services ($ in Millions) Asset Management Agreements1 Long Option Strategy Predictable fee-based revenues better ensure coverage of fixed costs Significant upside potential with limited downside risk • De-risked Energy Services business by securing 10 years of contracted cash payments with mi
Slide 18: CEV – SREC Hedging Strategy Stabilizes Revenue
CEV – SREC Hedging Strategy Stabilizes Revenue Based on Energy Year1, as of December 31, 2022 Percent Average Current Price Hedged Unhedged Hedged Price (EY) EY 2023 400 21 95% $203 $228 EY 2024 395 6 98% $197 $215 Over 95% Thousands hedged through EY 2025 353 46 89% $190 $201 Energy Year EY 2026 12
Slide 19: Fiscal 2023 First Quarter NFE by Business Unit
Fiscal 2023 First Quarter NFE by Business Unit ($ in 000s) Three Months Ended December 31, 2022 2021 Change New Jersey Natural Gas $54,664 $51,080 $3,584 Clean Energy Ventures $(3,582) $(6,821) $3,239 Storage and Transportation $6,243 $2,962 $3,281 Energy Services $52,533 $17,567 $34,966 Home Servic
Slide 20: Reconciliation of NFE and NFEPS to Net Income
Reconciliation of NFE and NFEPS to Net Income ($ in 000s) (Unaudited) Three Months Ended December 31, 2022 2021 NEW JERSEY RESOURCES • NFE is a measure of earnings based on the elimination of timing differences to effectively A reconciliation of net income, the closest GAAP financial measure, to net
Slide 21: Other Reconciliation of Non-GAAP Measures
Other Reconciliation of Non-GAAP Measures ($ in 000s) (Unaudited) Three Months Ended December 31, 2022 2021 A reconciliation of gross margin, the closest GAAP financial measurement, to utility gross margin is as follows: NJNG Utility Gross Margin Operating revenues $ 357,746 $ 274,772 • NJNG's utili
Slide 22: NJR Capital Plan
NJR Capital Plan1 ($ in Millions) 1Q Near Real Time FY2023A FY2022A FY2023E FY2024E Return? New Jersey Natural Gas New Customer $13 $54 $54 - $58 $56 - $60 Yes Maintenance & Integrity $27 $104 $109 - $113 $161 - $176 Cost of Removal / Other $9 $42 $36 - $40 $36 - $40 Facilities $9 $7 $31 - $34 $2 -
Slide 23: NJR Projected Cash Flows
NJR Projected Cash Flows ($ in Millions) FY2022A FY2023E FY2024E Cash Flow from Operations $324 $320 - $360 $450 - $490 Uses of Funds Capital Expenditures1 $590 $466 - $600 $489 - $671 Dividends2 $128 $132 - $137 $143 - $148 Total Uses of Funds $718 $598 - $737 $632 - $819 Financing Activities Commo
Slide 24: Environmental, Social and Governance Efforts
Environmental, Social and Governance Efforts Focus on Definable Accomplishments • 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 have invested over $1 billion over t
Slide 25: Shareholder and Contact Information
Shareholder and Contact Information Stock Transfer Agent and Registrar Corporate Headquarters The Transfer Agent and Registrar for the company’s common stock is Broadridge Corporate Issuer Solutions, Inc. (Broadridge). 1415 Wyckoff Road Wall, NJ 07719 Shareowners with questions about account activit