Slide 1: Financial and Strategic Update
Financial and Strategic Update May 2, 2023
Slide 2: Forward-Looking Statements and Use of Non-GAAP Measures
Forward-Looking Statements and Use of Non-GAAP Measures This presentation contains “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, included in this present
Slide 3: About Unitil
About Unitil Pure play New England utility creating long-term sustainable value Local distributor of electricity and natural gas in attractive service areas along the New Hampshire and Maine Seacoast • Growing customer base supported by strong regional economic growth • Continuing price advantage ov
Slide 4: Financial Results and Strategic Update
Financial Results and Strategic Update Strong financial results and continued execution of strategic plan Delivering Strong Financial Results • 2023 Net Income of $24.1 million, or $1.51 per share, through the first quarter − $0.16 per share increase compared to 2022 supported by successful rate cas
Slide 5: Customer and Employee Focus
Customer and Employee Focus Industry-leading customer service and commitment to our employees Continued Excellence Redesigned Energy Bill Customer satisfaction Guided by customer remains among industry feedback leaders Concise and intuitive summary information One of Business NH Magazine’s 2022
Slide 6: Record Best Reliability and Response Metrics
Record Best Reliability and Response Metrics Continued excellence for electric reliability and emergency gas response time Restored power to 99% of approx. 36,000 affected customers within 48 hours following March 2023 Nor’easter Record Best Electric Service Reliability Roughly 50% lower service int
Slide 7: Corporate Sustainability and Responsibility
Corporate Sustainability and Responsibility Advancing the clean energy transition and ensuring the long-term sustainability of our company Energy and the Environment We are committed to environmental stewardship and minimizing our impact on the environment while supporting the transition to a clean
Slide 8: Approval of Kingston Solar Filing
Approval of Kingston Solar Filing New Hampshire Public Utilities Commission determines project to be in public interest NH Statute RSA 374-G • Enables utility ownership of DER, limited to 6% of utility’s total distribution peak load (approximately 18MW for Unitil) • Individual generation projects li
Slide 9: First Quarter 2023 Financial Results
First Quarter 2023 Financial Results Net Income and Earnings Per Share Net Income of $24.1 million in the first quarter 2023, or $1.51 per share • Net Income increase of $2.6 million, or $0.16 per share, relative to the first quarter of 2022 • Earnings growth reflects higher Electric and Gas Adjuste
Slide 10: Volume and Adjusted Gross Margin Variances
Volume and Adjusted Gross Margin Variances Year-over-Year variances in units, customers, and adjusted gross margin Electric Unit Sales & Customers • Electric distribution revenue substantially decoupled (2) • C&I sales down (3.7%), Residential sales down (6.0%) Unit Sales Customers Adjusted Gross Ma
Slide 11: First Quarter Earnings Reconciliation
First Quarter Earnings Reconciliation Variances to prior period earnings • Adjusted Gross Margin(1) increased $5.0 million as a result of higher rates and customer growth • Operation and Maintenance Expenses decreased $0.4 million largely due to lower labor costs and professional fees, partially off
Slide 12: Upcoming Regulatory Agenda
Upcoming Regulatory Agenda Anticipated rate case activity in Maine and Massachusetts Northern Utilities (Maine) Fitchburg Gas and Electric Light • Request filed on May 1, 2023; Docket No. 2023-00051 • Preparing rate cases for both the gas and electric • Base rate increase of $11.8 million requested
Slide 13: Disciplined Investment Plan
Disciplined Investment Plan Anticipate Long-Term Rate Base growth of 6.5% to 8.5% Actual and Forecast Capital Investment(1) Capital Expenditure Breakdown $200 Five-year projected capital investment of approximately $820 million ~40% higher than prior five years 25%, $160 Strategic / Investments Mode
Slide 14: Balance Sheet Strength and Capitalization
Balance Sheet Strength and Capitalization Relatively limited interest rate exposure with rising rates Responsible Financing Plan Long-Term Financing Sources • Balanced capital structure of approximately 50% debt and 50% equity • Limited refinance risk and no variable rate long-term debt Debt, 25% •
Slide 15: Delivering on Financial and Strategic Goals
Delivering on Financial and Strategic Goals The energy transition offers robust long-term investment opportunities Transforming Customer Modernizing Electric and Accelerating the Clean Services and Energy Offerings Natural Gas Infrastructure Energy Transition • Connecting customers with value • Inve
Slide 16: Appendix
Appendix Slide 17 GAAP ROE 18 Rate Relief Summary 19 Long-Term Earnings Growth 20 Dividend Increase and Expected Payout 21 Strong Financial Position 22 Key Regulatory Recovery Mechanisms 23 GAAP Reconciliation of Adjusted Margin SLIDE 16
Slide 17: GAAP Return on Average Common Equity
GAAP Return on Average Common Equity GAAP Return on Equity over the last twelve months Company Average Common Equity LTM ROACE (1) Northern Utilities $257 7.7% Unitil Energy Systems $119 11.0% Fitchburg Gas and Electric $115 8.9% Granite State Gas $21 8.9% Unitil Corporation $476 9.3% (1) ROACE calc
Slide 18: Rate Relief Summary
Rate Relief Summary Successful regulatory strategy resulting in awards from both capital trackers and rate cases Company Activity Millions Date Effective Base Rate Case Increase $6.1 Q3 2022 Northern Utilities (New Hampshire) Capital Tracker (Step Adjustment) $1.6 Q3 2022 Base Rate Case Increase $11
Slide 19: Maintaining Long-Term Earnings Growth
Maintaining Long-Term Earnings Growth Long-term growth expectation remaining in the range of 5% to 7% $3.80 2023 Guidance Aligned With Long-Term Target $3.60 Managing earnings variability 7% Growth $3.40 • Decoupled margin provides stability and visibility − Over 80% of customers under decoupled rat
Slide 20: Dividend Increase and Expected Payout
Dividend Increase and Expected Payout Consecutive years of accelerated dividend rate increases Dividend Per Share and Payout Ratio $1.65 100% $1.62 Balancing dividend sustainability $1.60 $1.56 80% with capital investment $1.55 $1.52 opportunities $1.48 $1.50 60% $1.50 $1.46 $1.44 Long-term dividend
Slide 21: Strong Financial Position
Strong Financial Position Maintaining investment-grade credit ratings Strong Credit Metrics Credit Ratings – Moody’s (Mar. 31, 2023) S&P (Mar. 31, 2023) S&P Update CFO-WC/Total Debt (1) Northern Utilities Peer Peer BBB+ Unitil Group Group 11/20/21 08/05/22 Unitil Energy Systems Baa1 Avg. Median Fitc
Slide 22: Key Regulatory Recovery Mechanisms
Key Regulatory Recovery Mechanisms Timely Rate Recovery Unitil Energy Fitchburg - Electric Fitchburg - Gas Northern - ME Northern - NH Revenue Decoupling Power/Gas Supply Supply Related Bad Debt Energy Efficiency Transmission Net Metering Credits (1) Speci
Slide 23: GAAP Reconciliation of Adjusted Gross Margin
GAAP Reconciliation of Adjusted Gross Margin Three Months Ended March 31, 2023 SLIDE 23