Slide 1: Investor Presentation: First Quarter Fiscal 2024 Financial Results
February 2024 Investor Presentation First Quarter Fiscal 2024 Financial Results February 6, 2024
Slide 2: Forward-Looking Statements and Non-GAAP Measures
Forward-Looking Statements and Non-GAAP Measures 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 Li
Slide 3: Contents
Contents First Quarter Fiscal 2024 Conference Call 4 Agenda 5 2023 Sustainability Report 6 First Quarter Fiscal 2024 Highlights 7 Increases Fiscal 2024 NFEPS Guidance by $0.15 to $2.85 to $3.00 8 NFEPS Guidance by Segment 9 New Jersey Natural Gas 10 NJNG Rate Case 11 Clean Energy Ventures (CEV): Pip
Slide 4: FY 2024 First Quarter Conference Call Agenda
FY 2024 First Quarter Conference Call Agenda 1 FY 2024 Q1 Highlights Steve Westhoven | President and CEO 2 Financial Highlights Roberto Bel | SVP and CFO 3 Q&A Session 4
Slide 5: 2023 Sustainability Report
2023 Sustainability Report 15th Consecutive Year Highlights • Solidified our national leadership in innovative renewable energy with NJR Clean Energy Ventures' development of North America's largest capped landfill and largest floating solar arrays • Achieved the highest single-year investment in NJ
Slide 6: First Quarter and Year to Date Fiscal 2024 Highlights
First Quarter and Year to Date Fiscal 2024 Highlights Executing on our Strategic Plan to Drive Continued, Organic Growth Energy NJNG CEV S&T Services $0.74 On January 31st, NJNG filed a base rate case Increased capacity by ~4MW in Q1 fiscal 2024 NFEPS Continued contribution in line contribution from
Slide 7: Increases Fiscal 2024 NFEPS Guidance by $0.15 to $2.85 to $3.00
Increases Fiscal 2024 NFEPS Guidance by $0.15 to $2.85 to $3.00 Represents 18.4% Increase from Midpoint of FY 2023 Initial Guidance Range; Maintains 7%-9% long-term annual growth Net Financial Earnings per Share Guidance Range Outperformance Above Long-Term Growth Rate and Initial Guidance Range1 $2
Slide 8: NFEPS Guidance by Segment
NFEPS Guidance by Segment Energy Services to Represent a Larger Portion of NFEPS Guidance in 2024; Long-term NJNG Remains the Largest Contributor to NFEPS Fiscal 2024 NFEPS Guidance Long-term Expected by Segment NFEPS Composition NJNG and CEV projected to make up the predominate CEV S&T Home Service
Slide 9: New Jersey Natural Gas
New Jersey Natural Gas Strong Trend of Favorable Customer Growth Fiscal 2024 Capital Expenditures1,2,3 NJNG Customers (in thousands) 580 System Integrity 570 $30 560 IIP $7 550 ~46% of 540 576 580 capital 569 530 564 expenditures SAVEGREEN 558 548 earning a Cost of near real- $13 ~$102M Removal/Othe
Slide 10: NJNG: Rate Case Filing
NJNG: Rate Case Filing Filed on January 31, 2024 Estimated Timeline for Rate Case1 January 31, 2024 June 15, 2024 August 15, 2024 November 1, 2024 Requested an increase to base rates of $222.6 million Discovery Hearings & Initial Decision (ALJ)2 and Order (increase of $158.7 million in operating inc
Slide 11: Clean Energy Ventures (CEV): Pipeline of Investment Opportunities
Clean Energy Ventures (CEV): Pipeline of Investment Opportunities CEV owns and operates solar projects with approximately 473MW of capacity MWs 1600 ~49% of pipeline located in NJ ~51% located outside of NJ Total 1400 ~1.3 GW 215 Pipeline of 1200 ~870MW including projects under 1000 construction, co
Slide 12: Financial Review
Financial Review Roberto Bel SVP and Chief Financial Officer 12 12
Slide 13: Review of First Quarter Fiscal 2024
Review of First Quarter Fiscal 2024 ($ in Millions) Fiscal 1Q23 – Consolidated NFE ($ in millions) $ 110.3 NJNG $ (3.2) Utility Gross Margin1 $ 1.1 O&M $ (5.0) $14.1 $110.3 Depreciation & Amortization (D&A) $ (2.0) $(2.6) Interest expense, AFUDC, Income Tax $ 2.7 $(3.2) Clean Energy Ventures $ 14.1
Slide 14: Capital Plan
Capital Plan1,2 ($ in Millions) Capital plan supports long-term NFEPS growth targets of 7 – 9% No Changes from Prior Quarter $622 $596 $608 - $743 $578 - $742 $33 - $47 $8 - $16 $31 $140 - $204 $160 - $264 $142 $110 $145 $435 - $492 $410 - $462 $454 $335 FY2022A FY2023A FY2024E FY2025E NJNG CEV S&T
Slide 15: Projected Cash Flows
Projected Cash Flows1 ($ in Millions) YTD FY2023A FY2024E FY2025E FY2024A Cash Flow from Operations $479 $46 $450 - $490 $450 - $490 Uses of Funds Capital Expenditures2 $539 $114 $490 - $580 $495 - $675 Dividends3 $151 $41 $161 - $165 $174 - $178 Total Uses of Funds $690 $155 $651 - $745 $669 - $853
Slide 16: Investment Grade Profile
Investment Grade Profile Strong Credit Ratings Supported by Stable Cash Flows NJR Adjusted FFO / Adjusted Debt1 Current Credit Ratings NJNG NJR (Secured (Unsecured Rating) Rating) 20.0% 19.0% NAIC NAIC-1.E NAIC-2.A Moody's A1 (Stable) 18.1% 17.4% 17% - 18% Fitch A+ (Stable) 15.0% Strong Cash Flows 1
Slide 17: Well Positioned Debt Repayment Schedule
Well Positioned Debt Repayment Schedule No significant maturity towers in any particular year NJR Unsecured Senior Notes FY Maturity Principal 1 3.48% 2025 $100,000 Term Debt Maturity Schedule 3.54% 2026 $100,000 4.38% 2027 $110,000 as of December 31, 2023 / $ in Millions, unless otherwise noted 3.9
Slide 18: Growth Strategy and Key Highlights
Growth Strategy and Key Highlights 1 Maximize the value of existing assets to 7% - 9% produce “Utility-like” Returns Long-term expected NFEPS and 2 Thoughtful capital allocation with a defined capital plan of Dividend Growth Highest in peer group1 between $1.2 - $1.5 Billion in the next 2 years 3 Us
Slide 19: Appendix: Financial Statements and Additional Information
Appendix: Financial Statements and Additional Information 20 Reconciliation of NFE and NFEPS to Net Income 21 Other Reconciliation of Non-GAAP Measures Reconciliation of Adjusted Funds from Operations to Cash 22 Flow from Operations 23 Fiscal 2024 First Quarter NFE and NFEPS by Business Unit 24 CEV:
Slide 20: Reconciliation of NFE and NFEPS to Net Income
Reconciliation of NFE and NFEPS to Net Income ($ in 000s) (Unaudited) Three Months Ended December 31, 2023 2022 ◦ NFE is a measure of earnings based on the NEW JERSEY RESOURCES elimination of timing differences to effectively match the earnings effects of the economic A reconciliation of net income,
Slide 21: Other Reconciliation of Non-GAAP Measures
Other Reconciliation of Non-GAAP Measures ($ in 000s) (Unaudited) Three Months Ended December 31, 2023 2022 A reconciliation of gross margin, the closest GAAP financial measurement, to utility gross margin is as follows: NJNG Utility Gross Margin Operating revenues $ 293,430 $ 357,746 • NJNG's utili
Slide 22: Reconciliation of Adjusted Funds from Operations to Cash Flow from Operations
Reconciliation of Adjusted Funds from Operations to Cash Flow from Operations Adjusted Funds from Operations, FY2024 Adjusted Debt, FY2024 • Adjusted funds from operations is cash flows (Millions) (Millions) from operating activities, plus components of working capital, cash paid for interest (net o
Slide 23: Fiscal 2024 Q1 NFE and NFEPS by Business Unit
Fiscal 2024 Q1 NFE and NFEPS by Business Unit1 ($ in 000s) Net Financial Earnings (NFE) (Thousands) Three Months Ended December 31, 2023 2022 Change New Jersey Natural Gas $51,444 $54,664 $(3,220) Clean Energy Ventures $10,522 $(3,582) $14,104 Storage and Transportation $3,640 $6,243 $(2,603) Energy
Slide 24: CEV: SREC Hedging Strategy Stabilizes Revenue
CEV: SREC Hedging Strategy Stabilizes Revenue Based on Energy Year1, as of December 31, 2023 Hedged Unhedged Percent Hedged Average Price Current Price (EY) EY 2025 353 46 89% $190 $200 89% hedged through Energy Year 2025 Thousands EY 2026 324 73 82% $181 $187 82% hedged EY 2027 109 281 28% $157 $17
Slide 25: Capital Plan Table
Capital Plan Table1,2 ($ in Millions) Near Real Time FY2023A YTD FY2024A FY2024E FY2025E Return? New Jersey Natural Gas New Customer $77 $27 $75 - $80 $85 - $90 Yes IIP $43 $7 $26 - $30 $26 - $30 Yes SAVEGREEN $60 $13 $48 - $52 $48 - $52 Yes Clean Fuels $1 $0 $40 - $50 $45 - $55 IT $61 $15 $60 - $65
Slide 26: NJR's Business Portfolio
NJR’s Business Portfolio Natural Gas and Renewable Fuel Distribution; Solar Investments, Wholesale Energy Markets; Storage & Transportation Infrastructure; Retail Operations New Jersey Natural Gas Operates and maintains Natural Gas transportation and distribution (NJNG) infrastructure serving approx
Slide 27: NJNG: Supportive Regulatory Construct
NJNG: Supportive Regulatory Construct Stable Rate Case Results Decoupled Rates for majority of customers • Rate case results are stable • Volume risk due to weather or energy conservation mitigated through the Conservation Incentive Program Launched in 2009, SAVEGREEN™ • Current ROE of 9.60% with a
Slide 28: Storage and Transportation (S&T): Overview
Storage and Transportation (S&T): Overview Stable Contribution from Leaf River (storage), Steckman Ridge (storage), and Adelphia Gateway (transportation) What to Expect ▪ 0.9 mmdth/d interstate pipeline from NE PA in Fiscal 2024 to greater Philadelphia area ▪ Acquired January 2020 / Placed in-servic
Slide 29: Energy Services: Overview
Energy Services: Overview Managing a Diversified Portfolio of Physical Natural Gas Transportation and Storage Assets to Serve Customers Across North America; Fee-based Revenue through Asset Management Agreements Asset Management Agreements • De-risked Energy Services business by securing 10 years of
Slide 30: Dividend Growth: Committed to Building Shareholder Value
Dividend Growth: Committed to Building Shareholder Value Strong Track Record of Dividend Growth Dividends per Share Dividend History Highlighted Rows Reflect Changes in Quarterly Cash Dividends $1.68 Ex-Dividend Date 12/12/2023 Record Date 12/13/2023 Payable Date 1/02/2024 Amount Per Share $0.42 7.4
Slide 31: Environmental, Social and Governance Efforts
Environmental, Social and Governance Efforts Focus on Definable Accomplishments • Achieved NJ operational emissions reductions over 55% since 2006 with goal of 60% by 2030 and net zero by 2050 • One of the largest owner-operators of solar assets in New Jersey, we have invested over $1 billion over t
Slide 32: Shareholder and Online Information
Shareholder and Online Information Stock Transfer Agent and Registrar The Transfer Agent and Registrar for the company’s common stock is Broadridge Corporate Issuer Solutions, Inc. (Broadridge). Shareowners with questions about account activity should contact Broadridge investor relations representa