Skip to ContentSkip to Main Site NavigationSkip to Site Left NavigationSkip to Site Utility NavigationSkip to Site Quick LinksSkip to Site SearchSkip to Company Navigation
Feb 6, 2019

New Jersey Resources Reports First-Quarter Fiscal 2019 Results

WALL, N.J.--(BUSINESS WIRE)--Feb. 6, 2019-- Today, New Jersey Resources (NYSE:NJR) reported results for the first-quarter of fiscal 2019. Highlights include:

  • Consolidated net income of $86.2 million, compared with $123.7 million in the first-quarter of fiscal 2018
  • Consolidated net financial earnings (NFE), a non-GAAP financial measure, were $54.1 million, compared with NFE of $135.3 million in the first-quarter of fiscal 2018
  • Reaffirmed NFE guidance for fiscal 2019 of $1.95 - $2.05
  • Construction began on the Southern Reliability Link (SRL)
  • The PennEast project received a favorable ruling from the U.S. District Court, allowing the project to conduct the land surveys in New Jersey
  • The Adelphia Gateway Project received a positive response on its Environmental Assessment from the Federal Energy Regulatory Commission (FERC)

First-quarter fiscal 2019 net income totaled $86.2 million, or $0.97 per share, compared with net income of $123.7 million, or $1.42 per share, during the same period in fiscal 2018. First-quarter fiscal 2019 NFE totaled $54.1 million, or $0.61 per share, compared with NFE of $135.3 million, or $1.56 per share, during the same period last year. Results during the first-quarter of fiscal 2018, included an income tax benefit of $57.6 million, or $0.66 per share, due to the revaluation of deferred taxes resulting from the reduction in the federal corporate tax rate.

"Our results for the first quarter are consistent with our expectations, and we remain on track to achieve our earnings guidance for fiscal 2019," said Steve Westhoven, president and COO of New Jersey Resources. "Our view is supported by continued customer growth at New Jersey Natural Gas and our infrastructure investments. Our team is focused on delivering results for our customers and shareowners."

A reconciliation of net income to NFE for the three months ended December 31, 2018, and 2017, is provided below.

        Three Months Ended
        December 31,
(Thousands)       2018       2017
Net income*       $ 86,248         $ 123,699  
Add:                
Unrealized (gain) loss on derivative instruments and related transactions       (10,932 )       34,855  

Tax effect

      2,583         (8,059 )
Effects of economic hedging related to natural gas inventory       (21,611 )       (25,387 )
Tax effect       5,136         8,244  
Net income to NFE tax adjustment       (7,331 )       1,981  
Net financial earnings       $ 54,093         $ 135,333  
                 
Weighted Average Shares Outstanding                
Basic       88,547         86,996  
Diluted       88,946         87,347  
                 
Basic earnings per share       $ 0.97         $ 1.42  
Add:                
Unrealized (gain) loss on derivative instruments and related transactions       (0.12 )       0.40  
Tax effect       0.03         (0.09 )
Effects of economic hedging related to natural gas inventory       (0.25 )       (0.29 )
Tax effect       0.06         0.10  
Net income to NFE tax adjustment       (0.08 )       0.02  
Basic net financial earnings per share       $ 0.61         $ 1.56  

*Results during the first fiscal quarter ended December 31, 2017, included a one-time income tax benefit of $57.6 million, or $0.66 per share, due to the revaluation of deferred taxes resulting from the reduction in the federal corporate tax rate.

NFE is a financial measure not calculated in accordance with Generally Accepted Accounting Principles (GAAP) of the United States. It is a measure of earnings based on eliminating timing differences surrounding the recognition of certain gains or losses, net of applicable tax adjustments, to effectively match the earnings effects of the economic hedges with the physical sale of natural gas, Solar Renewable Energy Credits (SRECs) and foreign currency contracts. NFE eliminates the impact of volatility to GAAP earnings associated with unrealized gains and losses on derivative instruments in the current period. For further discussion of this financial measure, please see the explanation below under “Non-GAAP Financial Information.”

A table summarizing our key performance metrics for the three months ended December 31, 2018, and 2017, is provided below.

        Three Months Ended
        December 31,
($ in Thousands)       2018       2017
Net income       $ 86,248         $ 123,699
Basic EPS       $ 0.97         $ 1.42
NFE       $ 54,093         $ 135,333
Basic NFE per share       $ 0.61         $ 1.56
                       

A table detailing NFE for the three months ended December 31, 2018, and 2017, is provided below.

        Three Months Ended
        December 31,
(Thousands)       2018       2017
Net financial earnings                
New Jersey Natural Gas       $ 31,713         $ 34,109  
Midstream       3,651         17,511  
Subtotal Regulated       35,364         51,620  
Clean Energy Ventures       10,205         71,250  
Energy Services       8,370         20,274  
Home Services and Other       76         (7,716 )
Subtotal Non-Regulated       18,651         83,808  
Subtotal       54,015         135,428  
Eliminations       78         (95 )
Total       $ 54,093         $ 135,333  
                         

NJR Reaffirms Fiscal 2019 NFE Guidance:

NJR reaffirmed fiscal 2019 NFE guidance of $1.95 to $2.05 per share, subject to the risks and uncertainties identified below under “Forward-Looking Statements.” NJR expects its regulated businesses to generate between 50 to 65 percent of total NFE, with New Jersey Natural Gas (NJNG) continuing to be the largest contributor. The following chart represents NJR’s current expected contributions from its subsidiaries for fiscal 2019 and beyond:

             
Company    

Expected Fiscal 2019
Net Financial Earnings
Contribution

   

Expected Fiscal 2020 and
Beyond Net Financial Earnings
Contribution

New Jersey Natural Gas     45 to 50 percent     50 to 60 percent
Midstream     5 to 15 percent     10 to 25 percent
Total Regulated     50 to 65 percent     60 to 85 percent
Clean Energy Ventures     25 to 35 percent     10 to 20 percent
Energy Services     5 to 15 percent     5 to 15 percent
Home Services and Other     0 to 2 percent     0 to 2 percent
Total Non-Regulated     30 to 52 percent     15 to 37 percent
             

In providing fiscal 2019 NFE guidance, management is aware there could be differences between reported GAAP earnings and NFE due to matters such as, but not limited to, the positions of our energy-related derivatives. Management is not able to reasonably estimate the aggregate impact or significance of these items on reported earnings and, therefore, is not able to provide a reconciliation to the corresponding GAAP equivalent for its operating earnings guidance without unreasonable efforts.

Regulated Business Update:

New Jersey Natural Gas

NJNG reported first-quarter NFE of $31.7 million, compared with $34.1 million, during the same period in fiscal 2018. The decrease in the first quarter was due primarily to higher O&M expenses and lower Basic Gas Supply Service (BGSS) incentives.

Customer Growth:

  • NJNG added 2,934 new customers during the first-quarter of fiscal 2019, compared with 2,637 during the same period in fiscal 2018, primarily driven by the residential new construction market. In addition, 53 existing NJNG customers expanded their natural gas service during the first-quarter of fiscal 2019.
  • NJNG expects to add between 28,000 and 30,000 new customers through fiscal 2021, representing an average annual growth rate of 1.8 percent and a cumulative increase in utility gross margin of approximately $16 million. For more information on utility gross margin, please see “Non-GAAP Financial Information” below.

NJNG Infrastructure Update:

  • The Southern Reliability Link,which is designed to provide a secondary interstate feed into the southern end of NJNG’s delivery system, began construction in the first-quarter of fiscal 2019. NJNG expects SRL to be in service during early 2020, and plans to recover its capital costs through a future rate case.
  • Safety Acceleration and Facilities Enhancement (SAFE) II is the five-year program approved by the New Jersey Board of Public Utilities (BPU) in September 2016 to replace the remaining 276 miles of unprotected steel main and associated services in NJNG’s distribution system. During the first-quarter of fiscal 2019, NJNG invested $11.2 million to replace 12 miles of unprotected steel main and services.
  • The New Jersey Reinvestment in System Enhancement (NJ RISE) programis the five-year, $102.5 million investment that began in 2014. During the first-quarter of fiscal 2019, NJNG continued to install distribution main to improve service resiliency into the southern portions of the Seaside Barrier Island. In addition, NJNG finalized preparations to install a new distribution main into Long Beach Island during the second-quarter of fiscal 2019. All NJ RISE projects are expected to be completed in fiscal 2019.

BGSS Incentive Programs:

BGSS incentive programs contributed $2 million to utility gross margin in the first-quarter of fiscal 2019, compared with $4.4 million during the same period in fiscal 2018. The lower results were due primarily to lower volume in the capacity release program and a decrease in value in the storage incentive program. Total savings for NJNG customers through the BGSS incentive programs for the three months ended December 31, 2018, were approximately $10 million.

Energy Efficiency Programs:

The SAVEGREEN Project®, NJNG’s energy-efficiency program, invested $3.7 million during the first-quarter of fiscal 2019 in grants and financing options designed to help customers with energy-efficiency upgrades for their homes and businesses.

Midstream

Midstream reported first-quarter fiscal 2019 NFE of $3.7 million, compared with $17.5 million during the same period of fiscal 2018. The decrease in NFE was due primarily to the effects of tax reform, which resulted in a tax benefit of $14 million recognized in the first-quarter of fiscal 2018.

Infrastructure Project Updates:

  • Adelphia Gateway - On January 4, 2019, FERC Staff issued its Environmental Assessment for the Adelphia Gateway pipeline project recommending that the FERC Certificate Order contain a finding of no significant environmental impact. Adelphia Gateway will deliver natural gas to under-served areas in the greater Philadelphia region, and NJR expects the project to be in service in fiscal 2019 and contribute materially to earnings in fiscal 2020.
  • PennEast Pipeline - On December 14, 2018, PennEast received a favorable ruling from the U.S. District Court, granting PennEast access to properties in New Jersey in order to conduct land surveys. PennEast has advised it currently expects the pipeline to begin construction in late 2019. However, construction could be delayed beyond 2019 due to factors beyond PennEast's ability to control or estimate precisely, including potential delays in obtaining (or inability to obtain) governmental and regulatory approvals and land-use rights and unforeseen construction delays.

Non-Regulated Businesses Update:

Energy Services

Energy Services reported first-quarter fiscal 2019 NFE of $8.4 million, compared with $20.3 million during fiscal 2018. The decrease in NFE was due primarily due to the lack of sustained cold weather and related pricing volatility as compared to last year.

Clean Energy Ventures (CEV)

CEV reported first-quarter fiscal 2019 NFE of $10.2 million, compared with NFE of $71.3 million in the same period last year. The decrease in NFE was due primarily to the effects of tax reform, which resulted in a tax benefit of $62.7 million recognized in the first-quarter of fiscal 2018.

First-quarter highlights:

  • Two commercial solar projects were placed into service in Franklin Township and Springfield Township, N.J., totaling 19.2 MW of capacity.
  • The Sunlight Advantage®, CEV's residential solar leasing program, added 166 residential customers and now serves over 7,400 residential customers, representing an investment of $222.2 million.

Home Services and Other Operations

In the first quarter of fiscal 2019, Home Services and Other Operations reported NFE of $0.1 million, compared with a net financial loss of $7.7 million in fiscal 2018. The increase in NFE was due primarily to the revaluation of deferred income taxes resulting from tax reform that did not recur in 2019.

Capital Expenditures and Cash Flows:

NJR is committed to maintaining a strong financial profile while continuing to invest capital in regulated and non-regulated projects.

  • During the first quarter of fiscal 2019, NJR used operating cash flows of $104.8 million, compared with $23.5 million during the same period in fiscal 2018.
  • First-quarter fiscal 2019 capital expenditures were $84.6 million, of which $61.2 million were related to regulated assets, compared with capital expenditures of $73 million, of which $47.1 million were related to regulated assets, during the same period in fiscal 2018.

Webcast Information:

NJR will host a live webcast to discuss its financial results today at 10 a.m. ET. A few minutes prior to the webcast, go to njresources.com and select “Investor Relations,” then scroll down to the “Events & Presentations” section and click on the webcast link.

Forward-Looking Statements:

This release 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 Litigation Reform Act of 1995. NJR cautions readers that the assumptions forming the basis for forward-looking statements include many factors that are beyond NJR’s ability to control or estimate precisely, such as estimates of future market conditions and the behavior of other market participants. Words such as “anticipates,” “estimates,” “expects,” “projects,” “may,” “will,” “intends,” “plans,” “believes,” “should” and similar expressions may identify forward-looking statements and such forward-looking statements are made based upon management’s current expectations, assumptions and beliefs as of this date concerning future developments and their potential effect upon NJR. There can be no assurance that future developments will be in accordance with management’s expectations, assumptions and beliefs or that the effect of future developments on NJR will be those anticipated by management. Forward-looking statements in this release include, but are not limited to, certain statements regarding NJR’s NFE guidance for fiscal 2019, forecasted contribution of business segments to fiscal 2019 NFE and beyond, future NJNG customer and utility gross margin growth, future NJR capital expenditures, infrastructure investments, Clean Energy Ventures’ ITC-eligible projects and demand for residential solar, earnings and dividend growth, as well as the ability to close and successfully implement the Adelphia Gateway acquisition, and construct the SRL and PennEast Pipeline projects.

The factors that could cause actual results to differ materially from NJR’s expectations include, but are not limited to, risks associated with our investments in clean energy projects, including the availability of regulatory and tax incentives, the availability of viable projects, our eligibility for ITCs, the future market for SRECs and electricity prices, and operational risks related to projects in service; the ability to obtain governmental and regulatory approvals, land-use rights, electric grid connection (in the case of clean energy projects) and/or financing for the construction, development and operation of our unregulated energy investments, pipeline transportation systems and NJNG and Midstream infrastructure projects, including NJ RISE, SRL, PennEast and Adelphia Gateway, in a timely manner; risks associated with acquisitions and the related integration of acquired assets with our current operations, including our planned Adelphia Gateway acquisition; volatility of natural gas and other commodity prices and their impact on NJNG customer usage, NJNG’s BGSS incentive programs, our Energy Services segment operations and our risk management efforts; the ability to comply with current and future regulatory requirements; the level and rate at which NJNG’s costs and expenses are incurred and the extent to which they are approved for recovery from customers through the regulatory process, including through future base rate case filings; the impact of a disallowance of recovery of environmental-related expenditures and other regulatory changes; the performance of our subsidiaries; operating risks incidental to handling, storing, transporting and providing customers with natural gas; access to adequate supplies of natural gas and dependence on third-party storage and transportation facilities for natural gas supply; the regulatory and pricing policies of federal and state regulatory agencies; timing of qualifying for ITCs due to delays or failures to complete planned solar projects and the resulting effect on our effective tax rate and earnings; the results of legal or administrative proceedings with respect to claims, rates, environmental issues, natural gas cost prudence reviews and other matters; changes in rating agency requirements and/or credit ratings and their effect on availability and cost of capital to our company; risks related to cyberattack or failure of information technology systems; the impact of volatility in the equity and credit markets on our access to capital; the impact to the asset values and resulting higher costs and funding obligations of our pension and post-employment benefit plans as a result of potential downturns in the financial markets, lower discount rates, revised actuarial assumptions or impacts associated with the Patient Protection and Affordable Care Act; commercial and wholesale credit risks, including the availability of creditworthy customers and counterparties, and liquidity in the wholesale energy trading market; accounting effects and other risks associated with hedging activities and use of derivatives contracts; the ability to optimize our physical assets; weather and economic conditions; changes to tax laws and regulations; any potential need to record a valuation allowance for our deferred tax assets; the ability to comply with debt covenants; demographic changes in NJR’s service territory and their effect on NJR’s customer growth; the impact of natural disasters, terrorist activities and other extreme events on our operations and customers; the costs of compliance with present and future environmental laws, including potential climate change-related legislation; environmental-related and other uncertainties related to litigation or administrative proceedings; risks related to our employee workforce; and risks associated with the management of our joint ventures and partnerships, and investment in a master limited partnership. The aforementioned factors are detailed in the “Risk Factors” sections of our Form 10-K that we filed with the Securities and Exchange Commission (SEC) on November 20, 2018, which is available on the SEC’s Web site at sec.gov. Information included in this release is representative as of today only, and while NJR periodically reassesses material trends and uncertainties affecting NJR’s results of operations and financial condition in connection with its preparation of management’s discussion and analysis of results of operations and financial condition contained in its Quarterly and Annual Reports filed with the SEC, NJR does not, by including this statement, assume any obligation to review or revise any particular forward-looking statement referenced herein in light of future events.

Non-GAAP Financial Information:

This release includes the non-GAAP financial measures NFE/net financial losses, financial margin and utility gross margin. A reconciliation of these non-GAAP financial measures to the most directly comparable financial measures calculated and reported in accordance with GAAP can be found below. As an indicator of NJR’s operating performance, these measures should not be considered an alternative to, or more meaningful than, net income or operating revenues as determined in accordance with GAAP. This information has been provided pursuant to the requirements of SEC Regulation G.

NFE/net financial loss and financial margin exclude unrealized gains or losses on derivative instruments related to the company’s unregulated subsidiaries and certain realized gains and losses on derivative instruments related to natural gas that has been placed into storage at Energy Services, net of applicable tax adjustments as described below. Volatility associated with the change in value of these financial instruments and physical commodity contracts is reported on the income statement in the current period. In order to manage its business, NJR views its results without the impacts of the unrealized gains and losses, and certain realized gains and losses, caused by changes in value of these financial instruments and physical commodity contracts prior to the completion of the planned transaction because it shows changes in value currently instead of when the planned transaction ultimately is settled. An annual estimated effective tax rate is calculated for NFE purposes and any necessary quarterly tax adjustment is applied to Clean Energy Ventures, as such the adjustment is related to tax credits generated by Clean Energy Ventures.

NJNG’s utility gross margin represents the results of revenues less natural gas costs, sales, expenses and other taxes and regulatory rider expenses, which are key components of NJR’s operations. Natural gas costs, sales, expenses and other taxes and regulatory rider expenses are passed through to customers and, therefore, have no effect on utility gross margin. Management uses these non-GAAP financial measures as supplemental measures to other GAAP results to provide a more complete understanding of NJR’s performance. Management believes these non-GAAP financial measures are more reflective of NJR’s business model, provide transparency to investors and enable period-to-period comparability of financial performance. A reconciliation of all non-GAAP financial measures to the most directly comparable financial measures calculated and reported in accordance with GAAP can be found below. For a full discussion of NJR’s non-GAAP financial measures, please see NJR’s 2018 Form 10-K, Item 7.

About New Jersey Resources

New Jersey Resources (NYSE: NJR) is a Fortune 1000 company that, through its subsidiaries, provides safe and reliable natural gas and clean energy services, including transportation, distribution, asset management and home services. NJR is composed of five primary businesses:

  • New Jersey Natural Gas, NJR’s principal subsidiary,operates and maintains over 7,500 miles of natural gas transportation and distribution infrastructure to serve over half a million customers in New Jersey’s Monmouth, Ocean and parts of Morris, Middlesex and Burlington counties.
  • NJR Clean Energy Ventures invests in, owns and operates solar projects with a total capacity of more than 250 megawatts, providing residential and commercial customers with low-carbon solutions.
  • NJR Energy Services manages a diversified portfolio of natural gas transportation and storage assets and provides physical natural gas services and customized energy solutions to its customers across North America.
  • NJR Midstream serves customers from local distributors and producers to electric generators and wholesale marketers through its 50 percent equity ownership in the Steckman Ridge natural gas storage facility, as well as its 20 percent equity interest in the PennEast Pipeline Project.
  • NJR Home Services provides service contracts as well as heating, central air conditioning, water heaters, standby generators, solar and other indoor and outdoor comfort products to residential homes throughout New Jersey.

NJR and its more than 1,000 employees are committed to helping customers save energy and money by promoting conservation and encouraging efficiency through Conserve to Preserve® and initiatives such as The SAVEGREEN Project® and The Sunlight Advantage®.

For more information about NJR:

www.njresources.com.

Follow us on Twitter @NJNaturalGas.
“Like” us on facebook.com/NewJerseyNaturalGas.
Download our free NJR investor relations app for iPad, iPhone and Android.

NJR-E

               
NEW JERSEY RESOURCES              
(Unaudited)              
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS              
               
        Three Months Ended
        December 31,
(Thousands, except per share data)       2018     2017
OPERATING REVENUES              
Utility       $ 199,965       $ 209,787  
Nonutility       611,802       495,518  
Total operating revenues       811,767       705,305  
OPERATING EXPENSES              
Gas purchases              
Utility       87,649       77,602  
Nonutility       535,383       445,084  
Related parties       2,185       2,149  
Operation and maintenance       60,102       54,160  
Regulatory rider expenses       12,632       11,769  
Depreciation and amortization       21,832       21,854  
Energy and other taxes       3,241       16,491  
Total operating expenses       723,024       629,109  
OPERATING INCOME       88,743       76,196  
Other income, net       869       5,976  
Interest expense, net of capitalized interest       13,486       11,905  
INCOME BEFORE INCOME TAXES AND EQUITY IN EARNINGS OF AFFILIATES       76,126       70,267  
Income tax benefit       (6,961 )     (50,168 )
Equity in earnings of affiliates       3,161       3,264  
NET INCOME       $ 86,248       $ 123,699  
               
EARNINGS PER COMMON SHARE              
Basic       $ 0.97       $ 1.42  
Diluted       $ 0.97       $ 1.42  
               
DIVIDENDS DECLARED PER COMMON SHARE       $ 0.2925       $ 0.2725  
               
WEIGHTED AVERAGE SHARES OUTSTANDING              
Basic       88,547       86,996  
Diluted       88,946       87,347  
                   
                   
       
RECONCILIATION OF NON-GAAP PERFORMANCE MEASURES      
               
        Three Months Ended
        December 31,
(Thousands)       2018     2017
NEW JERSEY RESOURCES              
 
A reconciliation of net income, the closest GAAP financial measurement, to net financial earnings is as follows:
               
Net income       $ 86,248       $ 123,699  
Add:              
Unrealized (gain) loss on derivative instruments and related transactions       (10,932 )     34,855  
Tax effect       2,583       (8,059 )
Effects of economic hedging related to natural gas inventory       (21,611 )     (25,387 )
Tax effect       5,136       8,244  
Net income to NFE tax adjustment       (7,331 )     1,981  
Net financial earnings       $ 54,093       $ 135,333  
               
Weighted Average Shares Outstanding              
Basic       88,547       86,996  
Diluted       88,946       87,347  
               
A reconciliation of basic earnings per share, the closest GAAP financial measurement, to basic net financial earnings per share is as follows:
               
Basic earnings per share       $ 0.97       $ 1.42  
Add:              
Unrealized (gain) loss on derivative instruments and related transactions       $ (0.12 )     $ 0.40  
Tax effect       $ 0.03       $ (0.09 )
Effects of economic hedging related to natural gas inventory       $ (0.25 )     $ (0.29 )
Tax effect       $ 0.06       $ 0.10  
Net income to NFE tax adjustment       $ (0.08 )     $ 0.02  
Basic NFE per share       $ 0.61       $ 1.56  
               
NATURAL GAS DISTRIBUTION              
               
A reconciliation of operating revenue, the closest GAAP financial measurement, to utility gross margin is as follows:
               
Operating revenues       $ 199,965       $ 209,787  
Less:              
Gas purchases       92,178       84,755  
Energy and other taxes             12,404  
Regulatory rider expense       12,632       11,769  
Utility gross margin       $ 95,155       $ 100,859  
               
CLEAN ENERGY VENTURES              
               
A reconciliation of net income to net financial earnings is as follows:              
               
Net income       $ 17,536       $ 69,269  
Add:              
Net income to NFE tax adjustment       (7,331 )     1,981  
Net financial earnings       $ 10,205       $ 71,250  
               
               
        Three Months Ended
(Unaudited)       December 31,
(Thousands)       2018     2017
ENERGY SERVICES              
               
The following table is a computation of financial margin:              
               
Operating revenues       $ 587,267       $ 477,981  
Less: Gas purchases       536,508       446,210  
Add:              
Unrealized (gain) loss on derivative instruments and related transactions       (11,177 )     33,873  
Effects of economic hedging related to natural gas inventory       (21,611 )     (25,387 )
Financial margin       $ 17,971       $ 40,257  
               
A reconciliation of operating income, the closest GAAP financial measurement, to financial margin is as follows:
         
Operating income       $ 44,886       $ 26,104  
Add:              
Operation and maintenance expense       5,273       4,436  
Depreciation and amortization       27       14  
Other taxes       573       1,217  
Subtotal       50,759       31,771  
Add:              
Unrealized (gain) loss on derivative instruments and related transactions       (11,177 )     33,873  
Effects of economic hedging related to natural gas inventory       (21,611 )     (25,387 )
Financial margin       $ 17,971       $ 40,257  
               
A reconciliation of net income to net financial earnings is as follows:              
               
Net income       $ 33,374       $ 11,120  
Add:              
Unrealized (gain) loss on derivative instruments and related transactions       (11,177 )     33,873  
Tax effect       2,648       (7,576 )
Effects of economic hedging related to natural gas       (21,611 )     (25,387 )
Tax effect       5,136       8,244  
Net financial earnings       $ 8,370       $ 20,274  
               
Home Services and Other              
               
A reconciliation of net income to net financial earnings is as follows:              
               
Net loss       $ (25 )     $ (7,716 )
Add:              
Unrealized loss on derivative instruments and related transactions       141        
Tax effect       (40 )      
Net financial earnings (loss)       $ 76       $ (7,716 )
                       
                       
        Three Months Ended
        December 31,
(Thousands, except per share data)       2018     2017
NEW JERSEY RESOURCES              
               
Operating Revenues              
Natural Gas Distribution       $ 199,965       $ 209,787  
Clean Energy Ventures       14,897       13,996  
Energy Services       587,267       477,981  
Midstream              
Home Services and Other       12,490       9,957  
Sub-total       814,619       711,721  
Eliminations       (2,852 )     (6,416 )
Total       $ 811,767       $ 705,305  
               
               
Operating Income              
Natural Gas Distribution       $ 43,032       $ 51,909  
Clean Energy Ventures       (174 )     (441 )
Energy Services       44,886       26,104  
Midstream       (637 )     (373 )
Home Services and Other       373       (1,227 )
Sub-total       87,480       75,972  
Eliminations       1,263       224  
Total       $ 88,743       $ 76,196  
               
               
Equity in Earnings of Affiliates              
Midstream       $ 3,801       $ 4,129  
Eliminations       (640 )     (865 )
Total       $ 3,161       $ 3,264  
               
               
Net Income (Loss)              
Natural Gas Distribution       $ 31,713       $ 34,109  
Clean Energy Ventures       17,536       69,269  
Energy Services       33,374       11,120  
Midstream       3,651       17,511  
Home Services and Other       (25 )     (7,716 )
Sub-total       86,249       124,293  
Eliminations       (1 )     (594 )
Total       $ 86,248       $ 123,699  
               
               
Net Financial Earnings (Loss)              
Natural Gas Distribution       $ 31,713       $ 34,109  
Clean Energy Ventures       10,205       71,250  
Energy Services       8,370       20,274  
Midstream       3,651       17,511  
Home Services and Other       76       (7,716 )
Sub-total       54,015       135,428  
Eliminations       78       (95 )
Total       $ 54,093       $ 135,333  
               
               
Throughput (Bcf)              
NJNG, Core Customers       26.7       30.7  
NJNG, Off System/Capacity Management       27.4       38.7  
Energy Services Fuel Mgmt. and Wholesale Sales       156.7       163.1  
Total       210.8       232.5  
               
               
Common Stock Data              
Yield at December 31       2.6 %     2.7 %
Market Price              
High       $ 51.83       $ 45.45  
Low       $ 43.51       $ 38.60  
Close at December 31       $ 45.67       $ 40.20  
Shares Out. at December 31       88,680       87,475  
Market Cap. at December 31       $ 4,050,024       $ 3,516,513  
                       
                       
        Three Months Ended
(Unaudited)       December 31,
(Thousands, except customer and weather data)       2018     2017
NATURAL GAS DISTRIBUTION              
               
Utility Gross Margin              
Operating revenues       $ 199,965       $ 209,787  
Less:              
Gas purchases       92,178       84,755  
Energy and other taxes             12,404  
Regulatory rider expense       12,632       11,769  
Total Utility Gross Margin       $ 95,155       $ 100,859  
               
Utility Gross Margin, Operating Income and Net Income              
Residential       $ 64,139       $ 64,735  
Commercial, Industrial & Other       13,346       13,918  
Firm Transportation       14,396       16,260  
Total Firm Margin       91,881       94,913  
Interruptible       1,319       1,511  
Total System Margin       93,200       96,424  
Off System/Capacity Management/FRM/Storage Incentive       1,955       4,435  
Total Utility Gross Margin       95,155       100,859  
Operation and maintenance expense       36,883       34,821  
Depreciation and amortization       13,896       12,783  
Other taxes not reflected in gross margin       1,344       1,346  
Operating Income       $ 43,032       $ 51,909  
               
Net Income       $ 31,713       $ 34,109  
               
Net Financial Earnings       $ 31,713       $ 34,109  
               
Throughput (Bcf)              
Residential       14.5       13.6  
Commercial, Industrial & Other       2.8       2.6  
Firm Transportation       4.4       4.6  
Total Firm Throughput       21.7       20.8  
Interruptible       5.0       9.9  
Total System Throughput       26.7       30.7  
Off System/Capacity Management       27.4       38.7  
Total Throughput       54.1       69.4  
               
Customers              
Residential       478,983       463,679  
Commercial, Industrial & Other       29,640       28,656  
Firm Transportation       35,099       42,058  
Total Firm Customers       543,722       534,393  
Interruptible       32       30  
Total System Customers       543,754       534,423  
Off System/Capacity Management*       7       19  
Total Customers       543,761       534,442  
*The number of customers represents those active during the last month of the period.
Degree Days              
Actual       1,638       1,577  
Normal       1,565       1,576  
Percent of Normal       104.7 %     100.1 %
                   
                   
         
        Three Months Ended
(Unaudited)       December 31,
(Thousands, except customer, SREC and megawatt)       2018     2017
CLEAN ENERGY VENTURES              
               
Operating Revenues              
SREC sales       $ 7,147       $ 6,856  
Wind electricity sales and other       3,736       4,185  
Solar electricity sales and other       1,882       1,125  
Sunlight Advantage       2,132       1,830  
Total Operating Revenues       $ 14,897       $ 13,996  
               
Depreciation and Amortization       $ 7,923       $ 8,935  
               
Operating Loss       $ (174 )     $ (441 )
               
Income Tax Benefit       $ (23,204 )     $ (73,988 )
               
Net Income       $ 17,536       $ 69,269  
               
Net Financial Earnings       $ 10,205       $ 71,250  
               
Solar Renewable Energy Certificates Generated       53,899       53,568  
               
Solar Renewable Energy Certificates Sold       37,820       29,680  
               
Solar Megawatts Eligible for ITCs       20.9       1.8  
               
Solar Megawatts Under Construction       7.4       21.4  
               
ENERGY SERVICES              
               
Operating Income              
Operating revenues       $ 587,267       $ 477,981  
Less:              
Gas purchases       536,508       446,210  
Operation and maintenance expense       5,273       4,436  
Depreciation and amortization       27       14  
Energy and other taxes, net       573       1,217  
Operating Income       $ 44,886       $ 26,104  
               
Net Income       $ 33,374       $ 11,120  
               
Financial Margin       $ 17,971       $ 40,257  
               
Net Financial Earnings       $ 8,370       $ 20,274  
               
Gas Sold and Managed (Bcf)       156.7       163.1  
               
MIDSTREAM              
               
Equity in Earnings of Affiliates       $ 3,801       $ 4,129  
               
Other Income, Net       $ 1,992       $ 1,221  
               
Income Tax Provision (Benefit)       $ 962       $ (12,843 )
               
Net Income       $ 3,651       $ 17,511  
               
HOME SERVICES AND OTHER              
               
Operating Revenues       $ 12,490       $ 9,957  
               
Operating Income (Loss)       $ 373       $ (1,227 )
               
Other Income, Net       $ (198 )     $ 5,300  
               
Net (Loss)       $ (25 )     $ (7,716 )
               
Net Financial Earnings (Loss)       $ 76       $ (7,716 )
               
Total Service Contract Customers at December 31       109,919       111,615  
                   
                   

 

Source: New Jersey Resources

Media:
Michael Kinney
732-938-1031
mkinney@njresources.com

Investors:
Dennis Puma
732-938-1229
dpuma@njresources.com

 

Copyright West LLC. Minimum 15 minutes delayed.

Custom Software Development by Beacon Technologies, Inc.