Slide 1: Financial and Strategic Update
FINANCIAL AND STRATEGIC UPDATE February 13, 2024
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” including 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 th
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 • Fully regulated electric and gas operations • Growing customer base supported by strong regional e
Slide 4: Financial Results and Strategic Update
Financial Results and Strategic Update Strong financial results and continued strategic execution Achieving Strong Financial Results • 2023 Net Income of $45.2 million or $2.82 per share • $0.23 per share increase compared to 2022 supported by regulatory initiatives and customer growth • 8.9% year-o
Slide 5: Fiscal Year 2023 Financial Results
Fiscal Year 2023 Financial Results Net Income and Earnings Per Share 2023 Net Income of $45.2 million, or $2.82 per share • Net Income increase of $3.8 million, or $0.23 per share, relative to fiscal year 2022 • Earnings growth reflects higher distribution rates and customer growth, partially offset
Slide 6: Volume and Adjusted Gross Margin Variances
Volume and Adjusted Gross Margin Variances Year-to-Date variances in units, customers, and adjusted gross margin Electric Operations Unit Sales and Customers • Electric distribution revenue substantially decoupled (2) Weather Normalized Unit • Weather normalized C&I sales down (1.5%), Residential sa
Slide 7: Fiscal Year Earnings Reconciliation
Fiscal Year Earnings Reconciliation Variances to prior period Net Income • Adjusted Gross Margin(1) increased $15.9 million as a result of higher rates and customer growth, partially offset by warmer winter weather in 2023 and by the recognition, in the second quarter of 2022, of $2.4 million in hig
Slide 8: Fitchburg Rate Case Overview (Electric and Gas)
Fitchburg Rate Case Overview (Electric and Gas) FG&E rate cases progressing on schedule Rate Case Filing Details (1) Key Elements Docket Number 23-80 (electric) and 23-81 (gas) • Five-year Performance Based Ratemaking plans with annual inflation-based adjustments to revenue Test Year 2022 Test Year
Slide 9: Massachusetts Electric Sector Modernization Plan (ESMP)
Massachusetts Electric Sector Modernization Plan (ESMP) Plan to help the Commonwealth realize its Greenhouse Gas Emission limits consistent with the Clean Energy Climate Plan ESMP Summary Plan supports • Comprehensive distribution and technology investment plan to: • Improve reliability and resilien
Slide 10: Significant Investment Opportunities
Significant Investment Opportunities Anticipate long-term rate base growth of 6.5% to 8.5% Capital Investment Breakout(1) Consolidated Rate Base Over Time (as of December 31) $s in Millions Five-year CAGR of 7.3% approximates mid-point of long-range guidance Gas Infrastructure Replacement $1,200 $1,
Slide 11: Balance Sheet Strength and Capitalization
Balance Sheet Strength and Capitalization Maintaining investment grade credit ratings Responsible Financing Plan Long-Term Financing Sources • Maintaining a strong balance remains a top objective • Capital investments funded principally by Cash Flow From Operations less dividends Equity, 13% • Limit
Slide 12: Dividend Increase and Expected Payout
Dividend Increase and Expected Payout Consecutive years of accelerated dividend rate increases Historical Dividend and Payout Ratio $1.75 100% • Balancing dividend sustainability with capital $1.70 investment opportunities 90% $1.65 $1.62 80% $1.56 70% • Expected dividend payout ratio to remain in $
Slide 13: Continued Operating Excellence
Continued Operating Excellence Industry leading reliability, response time, and customer satisfaction Top-Tier Electric Service Reliability • 12% lower service interruption time over the last 5 years compared to the prior five years Continued Excellence in Gas Response Time • Responded to 91.2% emer
Slide 14: Maintaining Long-Term Earnings Growth
Maintaining Long-Term Earnings Growth Long-term growth expectation remaining in the range of 5% to 7%(1) $4.00 2024 Expectations $3.80 • 2024 earnings expected to be within long-term growth range • Decoupled margin provides stability and visibility – $3.60 over 80% of customers under decoupled rates
Slide 15: Recapping Financial Performance Over the Past Decade
Recapping Financial Performance Over the Past Decade Historical earnings growth at mid-point of long-term guidance Performance Over Last 10 Years Historical Earnings per Share (1) $3.00 7.7% Net Income 2.1x Net Income Annual Growth Compared to 2013 $2.50 $2.00 6.0% Earnings Per Share 1.8x EPS Annual
Slide 16: Continued Execution on Stated Objectives
Continued Execution on Stated Objectives Delivering value through consistent execution Objective Result Grow Earnings Per Share between 5% - 7% 9.5% annual EPS growth since 2021 Grow Rate Base between 6.5% - 8.5% 7.3% annual Rate Base growth over the last 5 years Decrease payout ratio to support
Slide 17: Key Elements of Unitil's Value Proposition
Key Elements of Unitil’s Value Proposition Delivering consistent results through a reliable, regulated strategy 8.5%-10.5% Expected Annual Total Shareholder Return (1) 5%-7% 6.5%-8.5% $910 million 55%-65% 15%-19% Cost Net Zero Expected Annual EPS Growth Expected Annual Utility Rate Base Growth Plann
Slide 18: Appendix
Appendix Slide 19 GAAP ROE 20 Rate Relief Summary 21 Key Regulatory Recovery Mechanisms 22 Dividend History 86,600 Natural Gas Customers 23 GAAP Reconciliation of Adjusted Margin SLIDE 18
Slide 19: 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 $254 8.4% Unitil Energy Systems $123 9.6% Fitchburg Gas and Electric 86,600$124 9.9% Natural Gas Customers Granite State Gas $21 7.2% Unitil Corporati
Slide 20: Rate Relief Summary
Rate Relief Summary Successful regulatory strategy resulting in awards from both capital trackers and rate cases Company Activity Millions Date Effective Capital Tracker $2.1 Q2 2023 Northern Utilities (Maine) Base Rate Case Increase $7.6 Q4 2023 Unitil Energy Systems Capital Tracker $1.2 Q2 2023 Ex
Slide 21: 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) 86,600
Slide 22: Consistent Dividend Payment Since Incorporation
Consistent Dividend Payment Since Incorporation Steadily increasing dividend per share since 2015 Reliable Dividend is Key Tenet to Value Proposition $1.80 $1.60 $1.40 $1.20 $1.00 86,600 Natural Gas Customers $0.80 $0.60 $0.40 $0.20 $0.00 SLIDE 22
Slide 23: GAAP Reconciliation of Adjusted Gross Margin
GAAP Reconciliation of Adjusted Gross Margin Twelve Months Ended December 31, 2023 86,600 Natural Gas Customers SLIDE 23