NewJersey Resources Corporation · NYSE:NJR
NewJersey Resources — A.G. Edwards Yield Conference 2007
28 slides from NewJersey Resources's conference presentation, May 15, 2007
Slide 1: A.G. Edwards Yield Conference
A.G. Edwards Yield Conference May 15, 2007 Laurence M. Downes Chairman and CEO
Slide 2: Regarding Forward-Looking Statements
Regarding Forward-Looking Statements Certain statements contained in this presentation are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can also be identified by the use of forward-looking terminology such as “may,”
Slide 3: NJR at a Glance
NJR at a Glance Ticker Symbol (NYSE): NJR Price Range (52 Weeks) $42.85 - $55.15 Common Shares Outstanding: 27.8 million Market Capitalization: $1.5 billion Annual Dividend Rate: $1.52 Dividend Yield: 2.9 percent Total Assets: $2.4 billion
Slide 4: NJR Today
Distribution Wholesale Energy Services Retail and Other Growing service area; close to NYC and Phila. Decoupled rate structure Successful incentive programs Majority of Assets and cash flow Growing transportation and storage portfolio Disciplined Risk Management No speculative trading Appliance and
Slide 5: Consistent Performance
Consistent Performance • New Jersey Resources is a company with … – 15 consecutive years of growth; an industry record – A 5-year average annual return of 13.3 percent – An above average dividend growth rate of 5.6 percent – A strong financial profile (S+P: A+, Moody’s: Aa3) – A realistic platform f
Slide 6: Fiscal 2007 Highlights
Fiscal 2007 Highlights • On track for 16 th consecutive year of earnings growth • Raised earnings guidance for the second consecutive quarter • Increased dividend 5.6 percent • Announced Steckman Ridge Storage project • Refunded customers over $71 million as a result of declining natural gas prices
Slide 7: NJNG Value Drivers
NJNG Value Drivers • Safe and reliable service • Consistent customer growth • Strong financial profile • Regulatory collaboration
Slide 8: Our Service Area
Our Service Area • Largest independent LDC in New Jersey • Growing customer base; over 477,000 customers • Primarily residential and small commercial • Consistent growth forecast NYC Phila . Atlantic City Excellent service area demographics
Slide 9: Strong Customer Growth
Strong Customer Growth Customer growth rate exceeds the industry average
Slide 10: Future Growth Potential
Future Growth Potential Pending Final Conceptual New Customers = 54,838 Non-heat customers Non-gas off main Non-gas on/near main Conversions = 130,965 Sources: Local Planning Boards and NJNG Harte Hanks & A.D. Little Studies Healthy “inventory” for continued customer growth
Slide 11: Regulatory Collaboration
Regulatory Collaboration • Incentive programs – Off-system sales – Storage – Financial Risk Management • Conservation incentive program – 3-year pilot effective October 1, 2006 – Stabilizes NJNG margins – Supported by BGSS savings • Strong focus on customer satisfaction – J.D. Power rating – BPU Com
Slide 12: Incentive Programs
Incentive Programs $29 $30 $24 $34 $37 $43 $23 • Customer bills reduced by about $321 million, or 4 percent, annually since program inception
Slide 13: Conservation Incentive Program
Conservation Incentive Program • NJNG protected for all variations in customer usage – Declining usage • $8.4 million in margin accrued in FYTD 2007 from weather – Weather • $5.9 million in margin accrued in FYTD 2007 from CIP • Initial customer level of savings of $10.6 million for each year of the
Slide 14: NJNG achieved its 14th consecutive year of best customer satisfaction
NJNG achieved its 14th consecutive year of having the best customer satisfaction rate of any major utility in New Jersey Customer Satisfaction BPU Inquiries per 1,000 Customers December 31, 2006
Slide 15: Key Wholesale Energy Services Drivers
Key Wholesale Energy Services Drivers • People working with physical assets • Leveraging volatility • Managing risk • Access to capital • Customer relationships
Slide 16: NJRES Net Income
NJRES Net Income Wholesale energy services are expected to contribute 40-45 percent of total earnings
Slide 17: Sales Volumes
Sales Volumes Storage Capacity am 333 31 0 2 00 263 ass 25 250 3s 2 a amy 17 Bis Bis a A 300 “ st a « « Bae oma Saat ae sacs Taine unum ad03 2004 200 2008 Counterpartien 206 200 vg F 156 F a0 aa @ Fr 30 NJR Energy Services
Slide 18: NJR Energy Services
NJR Energy Services
Slide 19: Steckman Ridge LP
Steckman Ridge LP • 50/50 JV with Spectra Energy – Investment totals $250 million • Field is located in Bedford County, PA – Discovered in 2002 – Producing gas since 2003 – Acquired from Pennsylvania General Energy • Convert to a 10+Bcf storage facility • Multiple pipeline interconnect options – Tex
Slide 20: Project Location
Project Location Rockies Supply Gulf Supply LNG LNG Cove Point LNG
Slide 21: NJNG Capital Expenditures
NJNG Capital Expenditures FY 2008 Estimate: $69.1 million FY 2007 Estimate: $69.7 million
Slide 22: NJNG Net Plant in Service
NJNG Net Plant in Service millions
Slide 23: Capital Structure
Capital Structure Corporate Ratings: S&P: A+; Moody’s: Aa3 September 30, 2007 Estimate Note: Equity excludes OCI • Equity through Dividend reinvestment plan • NJNG MTN Program • NJR/NJNG bank facilities total $605 million
Slide 24: Consistent Earnings Growth
Consistent Earnings Growth NJR estimates earnings of $2.95 to $3.05 per basic share in fiscal 2007 * Net of certain items * September 30 March 31
Slide 25: Dividend Growth and Payout Ratio
Dividend Growth and Payout Ratio Dividends per Share Payout Ratio * Effective January 2, 2007 1-year dividend growth rate of 5.6 percent *
Slide 26: Share Repurchase Program
Share Repurchase Program Shares Authorized (millions): 3.5 Shares Repurchased (millions): 3.2 Split-adjusted average cost: $33.44 March 31, 2007 Plan expanded to 3.5 million shares in January 2006
Slide 27: NJR: Quality Performance
NJR: Quality Performance March 31, 2007 • Growing natural gas distribution business • Disciplined wholesale energy services strategy • Strong regulatory relations • Excellent financial profile • Consistent financial performance
Slide 28: A.G. Edwards Yield Conference
A.G. Edwards Yield Conference May 15, 2007 Laurence M. Downes Chairman and CEO
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