New Jersey Resources (NJR) 26 Nov 242024 Q4 Earnings call transcript

Hello, and thank you for standing by. My name is Regina, and I will be your conference operator today. At this time, I would like to welcome everyone to the New Jersey Resources Fiscal 2024 Fourth Quarter and Year-end Conference Call. [Operator Instructions] I would now like to turn the conference over to Adam Prior, Director of Investor Relations. Please go ahead.

you. Thank Jersey Webcast. Fourth New Conference and Fiscal and Call Resources to Quarter XXXX Year-end Welcome here by and joined our Bel, as I'm today as senior our CEO; President well Senior Roberto management and team. Vice members President other Chief Officer; Steve Financial of Westhoven, our Certain today's estimates call and within forward-looking statements statements meaning of in the the contain other securities laws.

factors beliefs X-K expectations forward-looking as recent Forms to in that ability or and our statements the assumptions to many items and call statements the our listeners our our XX-Q current materially X. These of XX-K forward-looking this the forming are with as can Form of caution also basis section of from release to SEC. We estimate wish and could the on found beyond earnings in found precisely. differ that include cause expectations, most control This be yesterday's filed Slide on furnished results

by assume referenced herein this not, statements of events. future We statement, light forward-looking to any review revise particular in do including or any obligation

referring adjusted certain and debt We financial be our of that provide utility more net as financial NFE. We to earnings operations also non-GAAP believe NFE, such financial loss, margin, complete understanding gross net funds will from financial margin, measures or a adjusted financial performance.

substitute GAAP. for non-GAAP these a intended are measures be However, to not

XX-K. measures discussed Item are of more financial non-GAAP our in Our fully X

we the our Roberto, on are on review your this today's beginning X-K accompanying slides year's for and financial will with by results. open available yesterday. who X; presentation website, begin call filed on followed Slide were questions. will The Form our will furnished Steve Then our highlights

I'll to Please and the turn Steve Steve. our said, Westhoven. President over that With go ahead, CEO, call

excellent NJR, business of Adam, for and by This performance financial all segments. morning, year driven our strong across was an good everyone. Thanks,

with energy future. resolution case NJNG's addition, a most base notably leaves we the successful items, and businesses, number enter efficiency our provides success fiscal for as investments greater positioned completed pending certainty programs. which, the throughout of we In strategic along successfully into NJR well This rate of XXXX

fiscal end consecutive guidance, raised of of value. range This high our this we is guidance to year strength that earlier ability exceeded fourth and of shareholder demonstrating model year. surpassing deliver XXXX, In the our diversified the we the NFEPS our initial business

We growth long-term level consistently efficiency reported and have a rate Gas, performance X% program. base investments energy stated more customer an our NFEPS At Jersey X% we target. of importantly, record our that to through of our and New Natural actual industry-leading exceeds grew SAVEGREEN

service or will enhanced a time a construction. completing continued booster drive These compression to New solar clean Energy over for under project. initiating moderate income a commissioned operational XX with CEV storage projects to River nearly which and efficiency. through and capacity Clean energy capped in recovery S&T Leaf revenues new customers. on services the a provide community landfill busy Ventures our to low in Jersey, of with either built was megawatts first placed year organic and project, It project higher contribute growth will

event. Services recognized great as our XX a is while Year. for during significant Overall, Pro a team. a with approximately delivering the completed benefited agreements Consecutive Ruud Google Services with Energy outsized asset many Top Eighth the division Partner from calls its contribution rating long January service from option near management announced in XX,XXX value the an from weather Home accomplishments XXXX finally, X-star was and strategy our year from this And

investments roughly case of New Natural last New outlined safe on for settlement base for future Utilities Gas' for and to that Slide a X. very NJR Counsel Jersey the resolution we reach Utilities of Jersey pleased and Board ahead, shortly, but details for with look recovery a growth, and to equitable through and our their we reliable As were ensure Rate is work. Public rate XXX,XXX of the we the their The division positioned approved customers. want fair to week well staff service overall, will Public thank all Board securing as Roberto go parties. I hard

We of balanced. have and the them a interest that are customers constructive working ensures fairly relationship with both shareholders

through history. Natural also we At we XXXX. New the in to Jersey company's our focus efficiency sale approval project offerings X in we but month, completed This strategy, sheet with Last our strengthens balance transaction its commercial on also our solar Gas sharpens portfolio. for solar just this on Sunlight to CEV, focus pipeline, from only Advantage gigawatt continue available the In growth. residential BPU line energy SAVEGREEN the commercial our expand with largest solar our over received of through not

to and we sustainable positioned well commitment a moving returns, filed in and with Gateway our S&T, capitalize on made high are with system, to River. pipeline clean to energy FERC are rate recovery At We capacity Leaf growth. reflect with investments at single-digit, our forward reinforcing case its commercial the Adelphia projects unlevered project

years fiscal focused across all on guidance. the segments, fiscal NJR per long-term of target XXXX $X.XX long-term after slide. NFEPS to NFEPS multiple is X%. are is With momentum of NJR its previously stated on as and its This outperformance, is objectives reflected our NFEPS year. growth with growth share to as deliver strategy next consistent guidance in rebasing this well we a of long-term positioned And X% to maintaining our outlined current

share. to This long-term from the and onetime to the gain For fiscal our reflects X% of Sunlight XXXX, our Advantage transaction. range $X.XX X% initial NFEPS exceeds rate growth per guidance is $X.XX

that outlined our supports portfolio businesses of that growth which foundation X. this provides We solid a complementary feel Slide we leading rate, on

of X% an high deployment through providing that drivers at operational investments, base and energy of Jersey target key X% growth operate stable New achieve at Natural for rate strong revenues Gas; River, the Adelphia, asset Leaf the capital improves solar at further additional allows ahead, Looking case; from our commercial flows. at SAVEGREEN availability; our long-term stable working continued and Services, growth and management agreements our recontracting capacity efficiency expected CEV and benefit that rates Energy we at through investments demand include: our investments to capacity; to cash customer to total continue our us expansion rate investments at recovery to expand from storage

by model opportunities potential Finally, has business NJR's market diversified upside in provide operational additional that mechanisms place and performance. driven

into break NFEPS XXXX Slide NFEPS expected visibility of these XX% our long-term drivers growth with our operations. come from segment, strong Together, X, fiscal out approximately to offer trajectory. our On we by utility

shareholders. and for provide our to long-term stability returns foundation strong a have We reliable

discuss New Slide Natural business with starting Now complementary Gas our units let's on Jersey X.

near returns. At we of steady Customer invested $XXX remained New million driven fiscal and growth real-time Jersey year, all conversions. Natural by in XX% construction combination CapEx, Gas, providing of a new that with both XXXX

will meet technologies solutions customers. to innovation advanced evolving focus on leveraging of and needs Our the our be

to Moving XX. Slide

opportunities. over commercial Our projects Ventures gigawatt business expanding investment solar as Clean of Energy options. potential continues CEV on solar has to a focus commercial

the sheet Sunlight balance Additionally, prudently sale capital. of to Advantage strengthens recycle us while our allowing

Moving to Slide XX.

stable to business revenues. Transportation returns continues fee-based and through deliver Storage Our

River, the fiscal X at booster capacity project supporting project Bcf we sales. In our completed XXXX, incremental and Leaf initiated capacity firm compression recovery

made to value FERC critical the the with filed pipeline Additionally, long-term case reflect Gateway Adelphia enhance a this investments for rate infrastructure. of our will system, in we further which

reach resolution of stages early to the in still a we hope calendar year the rate we're process, case in While XXXX.

I'll With review the Roberto? results. over to call of Roberto turn a that, the financial for

compared end our Thank year. NJR. reported for NFEPS per with you, of NFEPS Steve, the at on Fiscal share We last and increased a XXXX higher finishing morning, year range, was everyone. good the $X.XX strong share per of year $X.XX guidance

year-over-year business the raise fourth a during better that have significant quarter, contributions year. of asset increase. contributing a In to agreement than Our strong segments with total Energy initially Services performed us the portion the allowed to revenues, management guidance expected, recognized notable

rate layer. a of Steve details case settlement which mentioned return BPU approved week our summarizing increase Slide of of Under our includes X.X% of became last in NJNG's also that earlier, rate are equity We with equity return effective As XX. November X.XX%, annual revenue terms is provided of $XXX an a on on XX% million X-K with and the settlement, overall on it the the a allowed XX.

rate settlement. last reached rate and $X.X fair a settlement of with composite to equitable compared to depreciation base a we our increased increase X.XX%. Overall, billion, Our a XX%

to move Slide discuss XX, let's where NJR's Now capital plan. we'll

next the and years, several deploy assets. utility to storage energy clean enhance our Over we capital our expect infrastructure, transportation and grow our to portfolio expand

billion remain capital to expenditures we segment, down target approximately million planning area fiscal X%. XXXX. we're for growth from with $XXX $X.X as largest investment infrastructure invest slide, with $X.X aligns SAVEGREEN $XXX will and and efficiency XXXX, ranging includes NFEPS NJNG the growth fiscal million our billion, and by $XX the energy $XX Breaking it long-term of our to of continue upgrades for which to X% in projects, on with program XXXX customer shown million fiscal planned year. projected our million to This critical to will For

CEV. to Moving

between solar our our million $XXX commercial to XXXX. million $XXX planned continued have commitment and fiscal We reflects for This portfolio. growing

investments Advantage Residential While reflects disclosure, commercial the this we expected sale previous Sunlight solar our left the only portfolio. same following the CEV range from largely the our of

support to and organic fiscal Finally, are Leaf $XX our Adelphia generate million projects between River includes in This Storage and and investments growth. fee-based which ongoing XXXX. revenue see stable, million Transportation expected and will $XX at Gateway,

Our maintain generate allocation but positions to deliver balance strategy on X% X% also our cash capital long-term flows disciplined stable a strong only not NFEPS to sheet. NJR growth to and

credit metrics for returns while consistent As XX, businesses highlighted us delivering in our Slide to our our invest on strong shareholders. allow

reflects is remain between effectively. adjusted funds from manage our for which XX.X% XXXX flows to XXXX, strong, for adjusted fiscal fiscal Our ability operating XX% and cash and and debt ratio to XX% ranging debt operations to solid was generate projected

a These credit our at with sheet strong levels consistent rating NJNG balance and are maintaining at NJR. investment-grade

reduced debt particular This no significant interest us maturities long-term flexibility rate is financial staggered Our year. and with with in environment. any risk, especially evolving an provides in well

million XXXX, available $XXX have we through liquidity ensuring future we to fiscal substantial Additionally, facilities support have growth. credit in

$XXX cash other dividends be a We million from flow XXXX, foundation solid to $XXX and funding capital expect fiscal our and for plan, in providing operations needs. million our between corporate

superior balance maintaining have our metrics executing continue in as opportunistic on and an raising method issuances and strategic program flexibility NJR credit long-term strong an stable place while block value. dividend delivering financial summary, cash our use also and our only need excellent of reinvestment In equity. we shareholder flows to position priorities Consequently, no for sheet, equity

With to that, I'll turn XX. Slide for Steve call on the back concluding statements

Thanks, Roberto.

positioned we value our of As sustained, our existing with clean to strategic growth long-term We offer a plan, total industry-leading our diverse combined energy continue business NJR strong maximizing core targeting businesses. we X% assets, focus long-term expect our for of are XX%. the creating With expansion, for on rate, is yield and shareholders. our return dividend execute across a value shareholder XX% significant NFEPS growth to a and we investments

up, took only outlook sum rate you time NJR its and like driving And settled the recognize in superior Jersey a that way dedication for performance sustainable and their thank our itself company. positioned and with to its disciplined I'd has as financial today, energy energy year join are during for Their for future. work base Natural while to Gas' and efficiency our we position program continuing additional hard in a derisked an significantly to New us into excellent leader and growth drive approved, to We employees returns appreciate growth. infrastructure. To serves and deliver the the case NJR

the With open that, for call questions. up let's

first [Operator Robert of line will Mizuho Mosca Instructions] the question from Securities. come Our with

on another in books the here. year Congratulations

sale, guys implied the touch like you on of maybe if residential it mid-teens. north P/E could XX, solar economics of maybe even could Just seems be the

derived does the is So commercial electricity any be Or portfolio And would the helpful. would have this that really sales in color from capacity you the there future? you for have? affect that

Steve. Thanks for it's Rob, questions. the

sales, a continue the So residential of our portfolio to will sell wholesale market. market those We'll as amount far the primarily wholesale into [ as same the lease The the not ] and market. commercial electric market. electric into was change

And the take question will So same we asked. you be expect going to Roberto forward. that the PE

Yes, Rob, this is Roberto.

what to $XX So transaction, is Advantage we're to you'll today providing And million. our in regarding a what XX-K range the that the pretax see see of you'll is range. gain, is proceeds million Slide see guidance on $XX estimate we why that later Sunlight then you net is million. were higher is our $XXX.X what going guidance that after-tax on And $X.XX. the than that That's gain finally, around X long-term this be implied our

thoughts follow-up possibility you provide the [ a And a NJBPU. just by but on some Could helpful. maybe program. that maybe question. the a program initial different? I IIP broadly, Got the is wondering And look there it. order it's EA not you That's And more maybe XXXX really just got extended IIP ] ask? could understand about

Rob, and I it's Pat for the yes, calendar. Thanks we've appreciate a busy Migliaccio. had question, acknowledging, regulatory

settled a the and was base our So the noted, see case, very is as history, that, you outcome, a largest can fair up constructive we rate and in our we from ramp over will now only not program time. thought saving that ever which projected CapEx that you

with Let's not this capital program, spend always projects. fiscal we XXXX. our forget time intended IIP have discrete sunset around year was that will to the in to of That continue set a

our key evaluate to programs in opportunity might sense the and for make future what an us stakeholders. have we'll so And

Ellinghaus with Williams Shank. come question Chris next Siebert Our from of line the will

a year color your and us on the in wider little The that guidance the for there NJNG. and you range any thoughts on year this what terms range sort side why the for bigger give stuff? is of of are Can

$X.XX you $X.XX, are about as talking wide and earnings $X.XX Roberto. it this $X.XX It last -- talking to well. Chris, -- guidance year the Are you range. is was is

real no there. change there's So

absolute not bit little terms, in me, it dollar terms, wider than maybe a bigger dollar a looks agree...? normal little just It terms percentage. of In to don't you appears in

guidance, sorry, you're no, No, about no, right? our talking earning Yes.

this. but as just range is year of guidance second we starting Chris, from to widened $X.XX we're maybe, the doing reminder, $X.XX, So our the XXXX, in a this

any the Can us from terms you thoughts give the of and on accretion Sunlight minuses Advantage in the divestiture? dilution pluses Okay.

Yes.

we that's increasing this into that. going we by net So $X.XX. we're you take once guidance be taxes, for said That's and that our fiscal to gain onetime XXXX, account that why dilution expect about you from year and

And X years, future X over but or some dilution it to decreases the that time. goes For basically years, is dilution, there over X.

thoughts got us big, CEV any give us Can 'XX? through of any how in in terms it, you've I'll Okay. of year-end. at -- completions out backlog construction you under give you call a thoughts those pretty projects of terms play Can

about for place, projects forward. operating good construct, the states that have support we our So continuing that feel and to our with that completed, stands... of only also schedule, year going And the we we we're CapEx in, we're the CapEx the but in just not with schedule

River you in those proportionately terms lastly, as Okay. color give kind of or the expansion contracting us can And increase far any as the Leaf of goes, the in size of or color? any

increase associated X term that to match in debrine contracting Yes. of we as of kind we're the the stated And make facility going then larger it about And We've that to to becomes cavern that's over the in Bcf. that as larger. with going staged that. that construction, is be

and Bcf, to contract by long from to So period, same over should expect the going a X short, standpoint. increase it you're and the be able you

line of from question next our Travis take the Miller We'll Instructions] [Operator with Morningstar.

Sunlight why where sale. came this that this someone to a why about Or deciding with it better talk you deciding the Can you the you wondering all? somewhere on saw strategically the liked? to at strategically Just where to decision. do little Was is bit about you wondering else that you price talk in more something if returns do Just portfolio? now, something could Advantage

and to us continue what did to to capital the for on operate job think And for there, is a is bit. model continue -- business it it is was expand was a that in developing able a well. good ultimately, it and Advantage simplify certainly, Spruce We as And feel focus that our and a it market wholesale confident business allow great Sunlight the customers. solar us a out them. great for it's is going good I recycle to to Travis, of had And team it's place and space buying a did opportunity to to Yes, I little building the great grow business us today. what business. and that some

a for and was good way the just opportunity win-win company. So all around the that

your anywhere, than to the to NJNG? commercial it here solar, pipeline is growth but goes lot transferring the those more so than the know you that put solar thought of right, a so proceeds I the support of Okay. dollar more

Yes. of It's portfolio a companies.

capital look in. that So And its continue That's allocating essentially we'll an certainly, we'll take back when to at exercise always highest we that's returns, do that. to done.

Sure.

much or XXXX? XXXX, on how much regulatory of How approval Okay. the the And in then in is that of so is in CapEx a million that that system in of program? approved? the what's sensitivity in $XXX Kind around integrity terms of step-up

Travis, Pat this is Migliaccio.

integrity So filing review. everything rate vanilla and I'll call rate subject line investment. system system integrity that plain case will be But the to on case it

If there look that issues our related you were type of getting to no investment by case, rate our at approved last regulators.

Okay.

counting on some system and settlement the the So you're just support good integrity? from for read-through

Yes.

We at comments. for to Instructions] no have back Adam this call hand further the closing [Operator time. I any Prior will questions

thank us you, joining everyone, morning. Well, for this

and As your have interest always, we appreciate a Thanks. in day. great NJR investment and

all today's conclude joining. will meeting. That for you Thank

You disconnect. may now