Newjersey Resources Corporation · NYSE:NJR
Newjersey Resources — Q2 FY2013 Earnings Presentation
28 slides from Newjersey Resources's earnings presentation, May 2, 2013
Slide 1: Second Quarter Update
Exhibit 99.2 Exhibit Fiscal May 2,2013 2013 99.2Second Quarter Update
Slide 2: Forward-Looking Statements
Regarding Certain use date expectations forward-looking contribution Solar tropical The effect Company’s ability markets, commercial financing investments permitting, related NJNG’s process; customers Conservation potential and Form 2available of other customers, factors concerning Renewable 10-K on
Slide 3: Regarding Non-GAAP Financial Measures
Disclaimer This considered gains NJRES. without planned sales Management 3discussion presentation and or the transaction Volatility losses other of an Regarding impacts uses believes our alternative on taxes non-GAAP includes derivative associated net because ofand financial these Non-GAAP theregula
Slide 4: Fiscal 2013 Earnings Guidance
Previous $2.55 10-15% Current $2.60 Home 10-20% Energy 2-5% Clean 5-10% New Lower 460-70% Fiscal Jersey to Energy Services end Services Holdings Guidance $2.75 Guidance of 2013 Natural guidance Ventures perEarnings share Gas5-15% range Guidance raised to reflect improvement at NJRES
Slide 5: Net Financial Earnings by Business
Net basic ($MM) March Company New Midstream NJR Total Per 5NFEFinancial Energy Clean Home Jersey for $68.7 31, Three the share 2013 March Investments Energy Services/Other $74.1 Natural balance Services Earnings Months $1.64 2012 31, $104.2 5.2 Gas of2013 $1.79 16.4 Ended 11.9 fiscal (NFE) 2.3 $45.9
Slide 6: Key Drivers of Fiscal 2013 Full Year Outlook
Keyand Strong Higher Improving Estimate Fiscal Q3 6Full Year Drivers 2013 results full-year Q4Actual $2.60 SREC Fiscal Fiscal offrom Fiscal toNFE prices 2013 $2.75 2012 New at 2013 $.10 NJR as $2.71 Jersey solar Outlook toEnergy $.25 Natural market $(.17) Services Gas rebalances (NJNG) (NJRES)
Slide 7: Capital Expenditure Budget
$209MM Total $89.7 $150.0 CEV $133.9 $116.6 Fiscal NJNG Sandy Cost NGV SAFE/AIP System & New 7Increased Integrity of Customer NJNG Corporate Stations $75.0 2012 2013 $28.0 2013 $100.0 Removal Maintenance FY spending $36.2 $17.2 Est. 2013 $5.0 $50.0 $22.0 Capital &Capital in Other $0.0 regulated Budg
Slide 8: NJNG Results
NJNG ($MM) Gross •Strong 8Expected Customer SAFE NGV Lower Factors Margin Results results program Three infrastructure effective above togrowth contribute Months $110.5 from expected progressing tax up NJNG rate $111.6 spending Ended 660percent totooffset 70 $189.0 Sixwill percent over Months gross
Slide 9: Strong Customer Growth Continues
Strong •3,697 65 20 15 328 Increased Customer Conversions New Fiscal Residential Commercial Existing 9Demographics 1,741 1,956 percent existing Construction new 2013 Customer new conversions 4% customer growth customers oil electric propane 69% YTD construction customer 27% 53% andGrowth New Gross e
Slide 10: NJNG Customers Enjoy a Price Advantage
Equivalent $5.00 Based $4.40 $3.90 $3.20 $1.13 NJNG Source: 10 $4.00 on Fuel enjoys US100,000 Cost Energy Oil $3.00 a distinct Propane Value Comparable $2.00 Information for price Electricity $1.00 Customers advantage $0.00 BTUs Administration in its service Data as area of March 2013
Slide 11: Future New Customer Growth Potential
Future New 2013-2017 2018-Build Off Conversions Non On 7,246 Near With 29,192 Sources: 11 Main Main Heat Construction Main our Potential Arthur new 37,749 49,800 15,900 Out construction D. 71,600 Customer Little, Harte Growth and conversion Hanks and outlook, NJNG we see a total potential of over 20
Slide 12: Regulatory Incentive Programs
Regulatory Off-system Storage •Financial Customers Six-Month $8.0 2013 $6.1 $4.1 Total Incentive 12Optimization Promotes Sharing $4.0 2012 earnings formula programs risk $0.0 have Incentive long-term application Incentive sales management $1.95/share; ofsaved and capacity ofin85 80 Margins capacity
Slide 13: Regulatory Update and Infrastructure Programs
Regulatory Safety Approved Conservation In NGV Three Total NJNG The Filing Constructive 13 place SAVEGREEN investment Program agreements submitted Acceleration earns through inCollaboration aOctober regulatory Incentive return September to ofsigned the Project® $6 and of 2012; to NJ Program 7.1 envi
Slide 14: Superstorm Sandy Impact and Capital Update
Superstorm Impact Capital Total No NJNG 14 direct storm-related incremental will lower will impact file Sandy bethan treated itsexpected O&M deferred original Update capital ascosts rate on expenditures post-storm costs base fiscal arewith currently additions 2013 the estimates currently earnings Ne
Slide 15: NJR Energy Services Results
NJRBcf/day ($MM) Financial Expected Net 1.3 Over Producer 15 financial Energy 30Three percent services to Margin of contribute Services earnings Months firm of$29.2 are gross transportation Results aEnded expected 10 growing $29.4 margin to 20 Six $38.0 percent to part isMonths and be fee-based; $45
Slide 16: NJR Clean Energy Ventures Results
NJR Clean ($MM) Operating Expected Goal Enhancing 16 is to Three to commit Revenues shareowner Energy contribute Months $70 Ventures $1.4 Ended to 5value to $90 $0.5 15while Six million percent $4.6 Months saving $0.9 intocapital Operating fiscal Ended customers 2013 annually March Loss NFE money 31
Slide 17: Improving SREC Prices and Tax Benefits
Improving Tax Put Signed Increases Mandates Extends New October April SREC *Bid 17 downward credits, state Jersey prices 30, prices values in1, SREC 2013 RPS July BPU legislation 2012 SREC reported solar federal have have 2012 starting pressure –life approval –energy construction Prices energy impro
Slide 18: New Jersey Renewable Portfolio Standard
Previous New 4,000 5,000 026,000 1,000 Energy Supporting *New 18 012 RPS* Jersey’s 2013 GWhrs RPS Year RPS 2014 utilizes a sustainable Clean 3,000 2015 retail Energy 2,000 2016solar electricity 2017 Commitment industry 2018 sales 2019 inforecast New2020 Jersey provided 2021 2022 by2023 Rutgers 2024B
Slide 19: Declining Installed Solar Costs
Declining Installed /w) $10.00 $12.00 1998 $2.00 $4.00 National NJRCEV Making *Source: 19 Analyst $8.00 1999 Lawrence solar Average Cost Actual estimate (Solar 2000 $ Cost more byCosts 2001 Year Berkeley $6.00 for competitive 2002 2012 2003 National 2004Laboratory 2005 2006(Behind 2007 2008 the mete
Slide 20: Strong Solar Results and Project Pipeline
Strong Total 47 Residential FY 294 Average $8.1 700 Over Commercial Fiscal $26.3 •9.1 Ground-mounted $4.7 Expected Approximately 20 Medford MW 2013 total homes leases million million; 1,400 commercial million 2013 Solar of installed size: results completion Township and backlog installed added custo
Slide 21: Midstream Assets
Midstream Contributed Expected Steckman 50 5.53 Contract 21 percent percent services to Ridge joint Assets contribute $4.1 ownership venture million provide 5in with to tosteady pipeline 10 six-month Spectra percent margins from Energy NFE toCanada fiscal Iroquois 2013 to the NFE northeast
Slide 22: Home Services
NJRconditioning Serves Expected Expanded Whole Standby Air Generator Pursuing Currently Home 22 Home energy house approximately generator geographic to marketing sales services Services contribute electric solutions andcontracts now installation in expansion and 128,000 2Sussex, for offered toplumbi
Slide 23: Long-term Financial Goals
Financial from Long-term Earnings Maintain 23 aGoals NFE strong New growth financial Jersey of 4Natural profile to 6 percent with Gas of a minimum 60 to 70 percent equity ratio Annualof 50 dividend percentgrowth of 5 percent Maintain a payout ratio at or lower than peer average
Slide 24: Net Financial Earnings Performance
Net Financial $2.70 2008 Solid $2.60 $2.71 $2.58 $2.46 $2.40 $2.24 24 2009 financial $2.402010 -$2.75$2.10 Earnings performance 2011 $1.80 2012 $1.50 2013 expected in fiscal 2013
Slide 25: Growing Dividends
Growing $1.70 2008 19 $1.60 $1.54 $1.44 $1.36 $1.24 *$1.12 25Current dividend 2009 $1.60 Dividends annual 2010 increases $1.502011 rate $1.40 in 2012 17 $1.30 years 2013* $1.20 $1.10 $1.00
Slide 26: Payout Ratio
Payout 65% 63% 2005 *Goal ** 26Based Peer 49% 55% of 2006 Ratio* 60 group on56% 33% 2007 to NJR 65 average 16% 57% Net 2008 percent 0% 51% Financial 2009 based payout 52% 2010 onEarnings 49% ratio 2013 201148% earnings 2012 50%Peer estimates Group**and indicated dividend from Bloomberg. Peer group:
Slide 27: Fundamental Drivers of Solid Earnings Growth
Fundamental Solid Earnings Core Strong Infrastructure Regulatory CEV Goal SREC Ongoing Fundamentals 27 utility is spending earnings market customer toearnings over spend incentives continues Growth investment improving the deliver performance consistent $70 growth remainder contributions toDrivers c
Slide 28: Second Quarter Update
Fiscal2,2013 May 2013Second Quarter Update
New Jersey Resources — Q2 FY2013 Earnings Presentation on 6ix