Newjersey Resources Corporation · NYSE:NJR
Newjersey Resources — Q3 2019 Earnings Presentation
24 slides from Newjersey Resources's earnings presentation, Aug 6, 2019
Slide 1: Third Quarter 2019 Update
Third Quarter 2019 Update August 6, 2019
Slide 2: Forward-Looking Statements
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 Litigation Reform Act of 1995. New Jersey Resources
Slide 3: Non-GAAP Measures
Non-GAAP Measures 2 This presentation includes the non-GAAP measure, NFE. As an indicator of the Company’s operating performance, NFE should not be considered an alternative to, or more meaningful than, GAAP measures, such as cash flows, net income, operating income or earnings per share. NFE exclud
Slide 4: Agenda
AGENDA Third-Quarter 2019 Highlights Steve Westhoven Financial Review Pat Migliaccio Q&A 3
Slide 5: Third-Quarter Highlights
THIRD-QUARTER HIGHLIGHTS Steve Westhoven President & Chief Operating Officer President & Chief Operating Officer 4
Slide 6: Third-Quarter Fiscal 2019 Highlights
Third-Quarter Fiscal 2019 Highlights Infrastructure Investments Received Burlington County permits required to complete the Southern Reliability Link (SRL); 50 percent of the 30-mile pipeline is complete All land surveys for the PennEast project are complete Financial Results Net financial los
Slide 7: Projected Sources of NFE
Projected Sources of NFE • Reaffirmed fiscal 2019 NFE guidance of $1.95 - $2.05; expected to be toward the low-end of range Fiscal 2019 Fiscal 2020 and Beyond NJR Energy Services NJR Home 1% - 5% 5%-15% 5%-10% Services 1% - 2% Midstream Midstream 5% - 15% 5%-20% NJR Energy NJR Home Regulated Service
Slide 8: SRL Rate Case
New Jersey Natural Gas Received permit/approvals from Burlington County needed to complete the project SRL 50 percent of the 30-mile project completed Rate Filed update with BPU with actual data; request remains relatively unchanged Case Discovery phase ongoing; preliminary negotiations to b
Slide 9: NJR Clean Energy Ventures
NJR Clean Energy Ventures Commercial Solar Placed one project into service in the third quarter, adding 10.0 MW of capacity; placed additional 6.3 MW project in service in July 2019 Two projects currently under construction On track to complete six projects in fiscal 2019, adding 50 MW of inst
Slide 10: Financial Review
FINANCIAL REVIEW Pat Migliaccio Senior Vice President & Chief Financial Officer 9
Slide 11: Changes in Net Financial Earnings – FY 3Q19
Changes in Net Financial Earnings – FY 3Q19 $10.0 $0.0 Three Months Millions -$10.0 Ended -$8.0 June 30, -$6.2 -0.4 $1.0 $2.5 2019 -$20.0 -$17.5 -$6.3 -$30.0 June 30, 2018 NJNG Midstream CEV Energy Services HS/Other June 30, 2019 $300.0 $269.4 $250.0 -$0.5 -$11.1 Nine $200.0 Months -$55.7 Millions $
Slide 12: NJRCEV - SREC Hedging Strategy Stabilizes Revenue
NJRCEV - SREC Hedging Strategy Stabilizes Revenue Percent Hedged Average Price Current Price (EY) EY20 336 336 100% $198 $232 Percent Hedged Average Price Current Price (EY) EY21 343 349 98% $197 $220 Percent Hedged Average Price Current Price (EY) EY22 148 348 43% $197 $185 0 50 100 150 200 250 300
Slide 13: NJR Capital Plan
NJR Capital Plan ($MM) FYTD 2019A* 2019E 2020E 2021E New Customer $32.0 $43.4 $47.3 $51.4 Maintenance 53.2 78.9 72.3 57.0 Cost of Removal/Other 41.5 57.0 66.2 46.5 SAFE II 37.6 49.8 42.6 34.8 NJ RISE 19.6 31.7 24.5 0.0 SRL 57.7 81.6 118.5 0.0 Infrastructure Investment Program 0.0 5.5 83.2 107.2 Tota
Slide 14: NJR Sources and Uses of Capital
NJR Sources and Uses of Capital 2019E 2020E 2021E $1,000 $800 Millions $600 $400 $200 $0 Sources Uses Sources Uses Sources Uses LT Debt/Asset Sales Equity CFFO Capex Dividends Capital Plan Supports Infrastructure Investments, While Maintaining Strong Balance Sheet 13
Slide 15: New Jersey Resources
New Jersey \ Resources
Slide 16: Appendix
New Jersey \ Resources APPENDIX
Slide 17: NJNG – Strong Customer Growth
NJNG – Strong Customer Growth Third Quarter Fiscal 2019 Third Quarter Fiscal 2019 • 1,770 new customers added 10,000 9,667 9,596 – 1,055 new construction – 715 conversions 2019 New Customer Additions Forecast 7,500 6,936 6,800 Customers 5,000 65% 35% 2,500 0 YTD 2018 YTD 2019 FY18A FY19E* New Constr
Slide 18: Fiscal 2019 Third Quarter NFE
Fiscal 2019 Third Quarter NFE Three Months Ending June 30, Nine Months Ended June 30, 2019 2018 Change 2019 2018 Change New Jersey Natural Gas ($3.8) $2.4 ($6.2) $96.5 $97.0 ($0.5) NJR Midstream 3.1 3.5 (0.4) 11.2 22.3 (11.1) Regulated Businesses (0.7) 5.9 (6.7) 107.7 119.3 (11.6) NJR Clean Energy V
Slide 19: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures A reconciliation of NFE for the three and nine months ended June 30, 2019 and 2018 to net income is provided below: 18
Slide 20: NJNG - Factors Supporting Future Customer Growth
NJNG - Factors Supporting Future Customer Growth New Construction Conversions 2019 Building Permits Issued1 Equivalent Customer Cost2 1,400 $4.50 $4.17 1,240 $3.93 1,200 $4.00 $3.50 1,000 $3.00 800 $2.36 666 $2.50 600 $2.00 $1.50 400 327 247 $0.93 $1.00 200 $0.50 0 $0.00 NJNG Ocean Monmouth Morris N
Slide 21: Midstream - PennEast Pipeline Project
Midstream - PennEast Pipeline Project Project Description • 20 percent ownership in 120-mile transmission pipeline to Northeast connecting Marcellus Shale region supply • Access to the lowest cost supply point in North America; benefits customers and local economies • Approved by FERC - January 19,
Slide 22: Dividend Per Share
Dividend Growth Rate of 6 – 8 Percent Annually Dividends Per Share 100% $1.20 $1.17 $1.09 90% $1.02 $1.00 $0.96 80% 70% $0.80 60% Dividend Per Share Payout Ratio 50% $0.60 40% $0.40 30% 20% $0.20 10% $0.00 0% 2016 2017 2018** 2019 Fiscal Year Ind. Div Rate Payout * * 2019 payout based on midpoint of
Slide 23: NJRCEV - SREC Hedging Strategy Stabilizes Revenue
NJRCEV - SREC Hedging Strategy Stabilizes Revenue Percent Hedged Average Price Current Price FY20 355 355 100% $194 $228 Percent Hedged Average Price Current Price FY21 321 345 92% $196 $210 Percent Hedged Average Price Current Price FY22 80 345 23% $195 $177 0 50 100 150 200 250 300 350 400 Thousan
Slide 24: NJR Projected Cash Flows
NJR Projected Cash Flows ($ millions) 2019E 2020E 2021E Cash Flow From Operations $272.7 $326.6 $391.4 Uses of Funds Capital Expenditures - NJNG/Other ($347.9) ($454.6) ($296.9) Capital Expenditures - PennEast (4.0) (11.4) (214.2) Capital Expenditures - CEV (154.9) (104.0) (107.0) Capital Expenditur