Rgc Resources Inc. · NASDAQ:RGCO

Rgc Resources — Investor Presentation (September 2020)

28 slides from Rgc Resources's investor presentation, Sep 15, 2020

  1. Slide 1: Investor Presentation September 2020

    Investor Presentation September 2020

  2. Slide 2: Forward-Looking Statements

    Forward-Looking Statements The statements in this presentation by RGC Resources, Inc. (the "Company") that are not historical facts constitute “forward- looking statements” made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995 that involve risks and uncer

  3. Slide 3: Agenda

    Agenda  Company Overview  Financial Profile  Growth Strategy  Outlook 2

  4. Slide 4: Organizational Structure

    Organizational Structure NASDAQ: RGCO C-Corp formed 1998 Regulated Non-Utility  Local Distribution Company  Partner in Mountain Valley Pipeline (LDC), located in Roanoke, VA (MVP)  Founded in 1883  Partner in proposed MVP Southgate project 3

  5. Slide 5: RGC Resources, Inc. Shareholder Return

    RGC Resources, Inc. Shareholder Return 76 years dividend payments 16 years dividend increases 5 years record earnings 6.1% dividend increase annual dividend $0.70 (per share) Note: Graph includes stock prices through July 31, 2020. 4

  6. Slide 6: RGC Resources, Inc. Earnings Per Share

    RGC Resources, Inc. Earnings Per Share $1.35 $1.40 TTM June 30: $1.25 Nine-months ended $1.15 June 30: $1.05 $1.11 $0.95 2020 2019 $0.85 $0.90 $0.86 Basic: $1.34 $1.03 $0.75 Diluted: $1.34 $1.02 $0.65 $0.69 $0.65 $0.55 $0.61 $0.57 $0.45 2017 2018 2019 2020 Dividends/Share 5

  7. Slide 7: RGC Resources, Inc. Return on Equity

    RGC Resources, Inc. Return on Equity Twelve-Months ended June 30: 12.0% 11.0% 13.0% 10.0% 10.7% 10.9% 9.0% 9.7% 8.0% 2017 2018 2019 2020 6

  8. Slide 8: Consolidated Equity and Debt Profile

    Consolidated Equity and Debt Profile Equity:  Top 3 institutional shareholders:  $197M Market Capitalization  T. Rowe Price 6.9%  Common shares issued and  BlackRock 4.6% outstanding: 8,147,437  Vanguard 4.0%  $40M availability on equity shelf  5.54% insider ownership  $15M at the market (A

  9. Slide 9: Environmental, Social, Governance

    Environmental Social  System Modernization  Employees  Emissions Reductions  Community Engagement  Reduced Carbon Footprint  Safety  Customer Partnerships  Economic Development Governance  Diverse Board of Directors  Compliance and Risk Management  Diversified Shareholder Ownership  Ince

  10. Slide 10: Roanoke Gas Service Territory

    Roanoke Gas Service Territory  Serve over 62,100 natural gas customers  Customer Count breakdown:  Residential 90%  C&I 10%  Volume breakdown:  Residential 40%  C&I 60% Note: Total customers as of June 2020. Volume breakdown per most recent fiscal year end. 9

  11. Slide 11: Roanoke Gas Regulated Utility

    Roanoke Gas Regulated Utility  VA State Corporation Commission (SCC)  VA in Top 4 on Forbes “Best States for Business” ranking1  9.44% authorized ROE Highly Stable  Alternative Cost Recovery Mechanisms Business Model  Weather Normalization  Revenue Sharing  Infrastructure Riders . SAVE infras

  12. Slide 12: Regulated Utility Growth Strategy

    Regulated Utility Growth Strategy  Utility Investment  CapEx  Ongoing Utility Growth  Customer Growth  Volumes Delivered 11

  13. Slide 13: Roanoke Gas CapEx (Twelve Months)

    Roanoke Gas CapEx Twelve-Months ended June 30: ($000’s) $24,000 $23,800 $22,000 $22,200 $21,800 $20,000 $20,400 $18,000 $16,000 $14,000 $12,000 $10,000 2017 2018 2019 2020 12

  14. Slide 14: Roanoke Gas CapEx Fiscal YTD

    Roanoke Gas CapEx Fiscal YTD at June 30: $18.5 Fiscal YTD $16.5 Millions $14.5 $12.5 Other $10.5 Capital $4.1 SAVE $8.5 2019 2020 Rider $7.0 $6.5 $4.5 Customer Growth & System $2.5 Expansion $0.5 $5.9 Total Capital Expenditures $0.4 million or 2% increase 13

  15. Slide 15: Roanoke Gas Customers

    Roanoke Gas Customers 2% growth since 2017 Average Customers (twelve-months ended June 30) 62,000 61,000 60,000 59,000 2017 2018 2019 2020 New customer additions: YTD Fiscal 2020 410 Fiscal 2019 668 Fiscal 2018 598 Fiscal2017 628 14

  16. Slide 16: Roanoke Gas Volumes

    Roanoke Gas Volumes Volumes Delivered (DTH) Fiscal YTD 2019 Fiscal YTD 2020 4,000 3,500 3,000 2,500 Thousands 2,000 1,500 1,000 500 - Residential Commercial Industrial 2020 vs 2019 Total Volumes 3% Residential Volumes (7)% Commercial and Industrial Volumes 10% 15

  17. Slide 17: Outlook

    Outlook  COVID-19  Strategic Opportunities  Economic Development 16

  18. Slide 18: COVID-19

    COVID-19  Community  Company  Liquidity  Customer Analyses  Earnings Guidance 17

  19. Slide 19: Strategic Opportunities

    Strategic Opportunities  Midstream Opportunities  MVP  Roanoke Gas CapEx  Roanoke Gas System Expansion  M&A 18

  20. Slide 20: Update RGC Midstream Investment

    Update RGC Midstream Investment  Project 92% complete $30 $20  $57 million to $59 million ($mm) $10 $21 $17 projected cash investment $12 $8 $0 Thru 2018A 2019A 2020E 2021E  Target COD early 2021 Fiscal Year Workers for the Mountain Valley Pipeline weld together sections of pipe near Lindside, WV

  21. Slide 21: Interconnect into Roanoke Gas Distribution System

    Interconnect into Roanoke Gas Distribution System 20

  22. Slide 22: Southgate

    Southgate  75 mile natural gas pipeline system  24 and 16 inch steel underground pipe  Starts at TRANSCO 165 and extends into central NC  Anchored by firm capacity commitment from PSNC Energy Schedule  Nov 2018: Filed application  Pending: Approval by FERC and other regulatory agencies  Targe

  23. Slide 23: Roanoke Gas Capital Budget

    Roanoke Gas Capital Budget $25 $21.9 $22.4 $21.0 $20.0 $20.0 $20 $18.0 $15 Millions $10 $5 $0 2019A 2020E 2021E 2022E 2023E 2024E Forecast totals through 2024: SAVE Infrastructure Replacement $43.3 Customer Growth & System Expansion $33.7 Utility Maintenance $24.4 Total $101.4 22

  24. Slide 24: Roanoke Gas System Expansion

    Roanoke Gas System Expansion  $4 million line extension  Access to over 1,500 potential customers  Anticipated service Fall 2020 23

  25. Slide 25: Economic Development

    Economic Development Mack Trucks (Volvo) will invest $13 Lumber grading facility million and hire 250 employees to adding 4 natural gas- manufacture medium-duty trucks. The Roanoke Times – 1.31.2020 fired kilns. Capacity to burn additional 210,000 Mack Trucks opens 13th U.S. truck DTH annually. fact

  26. Slide 26: Proposed 2.039-Acre Site for Roanoke Gas

    PROPOSED 2.039 -ACRE SITE FOR ROANOKE GAS

  27. Slide 27: Economic Development

    Economic Development  $300 million expansion to Roanoke Memorial Economists say Carilion Clinic Hospital, including new tower for emergency and heart patients, new psych center and parking garage with connected pedestrian adds over $3.2 Billion to skyway. (Times May 2019)  Kicked-off fundraising c

  28. Slide 28: Questions

    Questions

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