Financial Data and Key Metrics Changes - The company reported earnings per share (EPS) of $0.90 for Q2 2023, down from $0.96 in the prior year, impacted by warmer weather and higher interest costs [59][60] - Year-to-date EPS for 2023 was $2.94 compared to $3.04 in the previous year, reflecting a margin impact of approximately $0.38 due to significantly warmer weather [60][61] - Adjusted gross margin increased by $7.4 million and operating income increased by $1.9 million for Q2 2023, despite weather impacts [39][40] Business Line Data and Key Metrics Changes - Adjusted gross margin for the Regulated Energy segment increased by 9.4% for the quarter and 7.3% year-over-year [43] - The Unregulated segment saw a 4% increase in adjusted gross margin for the quarter, remaining relatively constant compared to the prior year [64] - The propane business experienced volume declines due to warmer weather, but margins were managed effectively [32][111] Market Data and Key Metrics Changes - Customer growth rates in natural gas distribution were 5.5% in Delmarva and 4% in Florida, indicating strong demand for natural gas [51][108] - Heating degree-days were down by over 30% year-over-year in Florida, significantly impacting volumes [30][50] - The company continues to see growth in residential and commercial infrastructure, particularly in areas like Middletown, Delaware, and Wildlight, Florida [55][56] Company Strategy and Development Direction - The company remains committed to its growth strategy, focusing on capital investments projected between $200 million to $230 million for 2023 [27][71] - Investments in renewable natural gas and pipeline expansions are key components of the company's strategy for sustainable growth [20][33] - The company is also enhancing its technology platform to improve service delivery and operational efficiency [98] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by warmer weather and rising interest rates but emphasized the team's focus on cost savings and margin acceleration [26][29] - The company expects to recognize close to $17.2 million in projected margin impact from permanent rates in Florida in 2024 [67] - Management remains optimistic about future growth opportunities driven by customer demand and ongoing infrastructure projects [46][99] Other Important Information - The company has initiated several new investment projects to meet strong customer demand for energy delivery services [47] - The Florida Public Service Commission approved the GUARD program, which is expected to enhance safety and deliverability in the distribution systems [49][93] - The company published its second Sustainability Report, highlighting a 16% decrease in emissions compared to 2019 [94] Q&A Session Summary Question: Can you provide context on the growth in Middletown and Wildlight? - Management highlighted the significant growth opportunities in these areas, supported by community development and infrastructure projects [76][77] Question: How does the Newberry expansion fit into the overall growth strategy? - The Newberry project is a new expansion that will convert propane customers to natural gas, reflecting the company's strategy to meet customer demand [80][102] Question: What are the criteria for evaluating acquisitions? - The company looks for earnings per share accretion, cultural fit, and operational synergies when considering acquisitions [112][126] Question: How will the GUARD program impact margins post-2024? - Management indicated that while the GUARD program's margins could be linear, they may vary based on other ongoing projects [114]

Financial Performance - For the three months ended June 30, 2023, total operating revenues were $139.47 million, with regulated energy contributing $92.19 million and unregulated energy contributing $53.46 million[250]. - Gross margin (GAAP) for the regulated energy segment for the six months ended June 30, 2023, was $119.7 million, an increase of $9.4 million, or 8.5% compared to the same period in 2022[253]. - Gross margin (GAAP) for the unregulated energy segment for the six months ended June 30, 2023, was $40.7 million, a decrease from $43.3 million in the same period in 2022[254]. Debt and Borrowings - The company reported a carrying value of long-term debt at June 30, 2023, of approximately $666.8 million, compared to an estimated fair value of $573.3 million[257]. - As of June 30, 2023, the company had $95.8 million in short-term borrowings outstanding at a weighted average interest rate of 5.33%[261]. - The company has entered into amended Shelf Agreements with Prudential and MetLife, expanding total borrowing capacity and extending the term for an additional three years[259]. Growth Strategy - The company’s growth strategy includes optimizing earnings growth in existing businesses and pursuing additional pipeline expansions[247]. - The company is focused on expanding its Marlin Gas Services' CNG transport business and entering LNG and RNG transport markets[247]. Lease Information - The weighted-average remaining lease term for operating leases as of June 30, 2023, was 8.37 years, with a weighted-average discount rate of 3.5%[267]. - Operating cash flows from operating leases for the six months ended June 30, 2023, were $1.465 million, compared to $1.428 million for the same period in 2022[267].

Chesapeake Utilities Corporation (NYSE:CPK) Q1 2023 Results Conference Call May 4, 2023 8:30 AM ET Company Participants Alex Whitelam - Head, IR Jeff Householder - President, CEO Beth Cooper - EVP, CFO, Treasurer & Assistant Corporate Secretary Jim Moriarty - EVP, General Counsel, Corporate Secretary & Chief Policy and Risk Officer Conference Call Participants Brian Russo - Sidoti Tate Sullivan - Maxim Group Operator Welcome to the Chesapeake Utilities First Quarter 2023 Earnings Conference Call. At this ti ...

[PART I—FINANCIAL INFORMATION](index=7&type=section&id=PART%20I%E2%80%94FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=7&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements for Chesapeake Utilities Corporation for Q1 2023 and 2022, including income, comprehensive income, balance sheets, cash flows, and stockholders' equity, with detailed notes [Notes to Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail accounting policies and financial results, covering acquisitions, revenue breakdowns, regulatory updates, segment performance, debt, equity, and derivative instruments * Acquired Davenport Energy's Siler City, North Carolina propane assets for approximately **$2.0 million**, adding 850 customers and 0.4 million gallons of annual propane distribution[180](index=180&type=chunk)[181](index=181&type=chunk) * Acquired Planet Found Energy Development, LLC for **$9.5 million** to accelerate efforts in converting poultry waste to renewable natural gas (RNG)[203](index=203&type=chunk)[231](index=231&type=chunk) Operating Revenues by Segment (Q1 2023 vs Q1 2022) | (in thousands) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | **Regulated Energy** | **$142,270** | **$127,891** | | **Unregulated Energy** | **$83,166** | **$101,292** | | Other and Eliminations | ($7,307) | ($6,303) | | **Total Operating Revenues** | **$218,129** | **$222,880** | * In February 2023, Shelf Agreements with Prudential and MetLife were amended, expanding total borrowing capacity to **$605.0 million** and extending the term for three years[36](index=36&type=chunk)[334](index=334&type=chunk) Condensed Consolidated Statements of Income (Unaudited) | (in thousands, except per share data) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | **Total Operating Revenues** | **$218,129** | **$222,880** | | **Operating Income** | **$54,915** | **$54,865** | | **Net Income** | **$36,344** | **$36,933** | | **Diluted Earnings Per Share** | **$2.04** | **$2.08** | Condensed Consolidated Balance Sheet Highlights (Unaudited) | (in thousands) | March 31, 2023 | December 31, 2022 | | :--- | :--- | :--- | | **Total Assets** | **$2,197,551** | **$2,215,037** | | Net property, plant and equipment | $1,836,695 | $1,810,473 | | Total current assets | $159,504 | $193,976 | | **Total Capitalization and Liabilities** | **$2,197,551** | **$2,215,037** | | Total stockholders' equity | $858,588 | $832,801 | | Long-term debt, net | $656,284 | $578,388 | | Short-term borrowing | $94,079 | $202,157 | Condensed Consolidated Statements of Cash Flows Highlights (Unaudited) | (in thousands) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | **$81,667** | **$69,120** | | Net cash used in investing activities | ($42,654) | ($29,935) | | Net cash used in financing activities | ($42,152) | ($38,953) | | **Net (Decrease) Increase in Cash** | **($3,139)** | **$232** | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=37&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management reports Q1 2023 net income of **$36.3 million** (**$2.04 per share**), a slight decrease from Q1 2022, with stable operating income despite warmer weather, driven by rate cases, higher propane margins, and expansion projects, offset by increased expenses and interest charges * The company's strategy focuses on growing earnings from its stable regulated energy base while investing in related, higher-return unregulated businesses, emphasizing midstream and downstream opportunities, including sustainable energy initiatives[44](index=44&type=chunk) Adjusted Gross Margin Reconciliation (Non-GAAP) | (in thousands) | Q1 2023 | Q1 2022 | | :--- | :--- | :--- | | Gross Margin (GAAP) | $94,599 | $93,083 | | Operations & maintenance expense | $17,758 | $15,640 | | Depreciation & amortization | $17,183 | $16,977 | | **Adjusted Gross Margin (Non-GAAP)** | **$129,540** | **$125,700** | * Lower consumption, primarily due to weather more than **20% warmer** than historical averages in northern service territories, resulted in a **$6.9 million** decrease in adjusted gross margin compared to Q1 2022[91](index=91&type=chunk) [Results of Operations](index=40&type=section&id=Results%20of%20Operations) For Q1 2023, operating income remained flat at **$54.9 million**, with adjusted gross margin increasing by **$3.8 million** due to the Florida rate case, higher propane margins, and customer growth, largely offset by a **$6.9 million** weather impact and increased operating expenses and interest charges Key Drivers of Adjusted Gross Margin Change (Q1 2023 vs Q1 2022) | (in thousands) | Pre-tax Income Impact | EPS Impact | | :--- | :--- | :--- | | Customer consumption (weather) | ($5,241) | ($0.29) | | Florida natural gas base rate proceeding | $3,104 | $0.17 | | Increased propane margins and fees | $2,322 | $0.13 | | Natural gas growth | $1,153 | $0.06 | | Increased demand for CNG/RNG/LNG services | $976 | $0.05 | * Interest charges increased by **$1.9 million** year-over-year, primarily due to the weighted-average interest rate on Revolver borrowings rising from **1.17% in Q1 2022 to 5.17% in Q1 2023**[397](index=397&type=chunk) * The effective income tax rate was **24.2% in Q1 2023**, down from **26.8% in Q1 2022**, mainly due to a **$1.3 million benefit** from a reduction in the Pennsylvania state income tax rate[398](index=398&type=chunk) [Segment Results](index=48&type=section&id=Segment%20Results) The Regulated Energy segment's operating income grew **8.5% to $37.6 million**, driven by rate relief and customer growth, while the Unregulated Energy segment's operating income fell by **$2.8 million to $17.2 million** due to warmer weather impacts Regulated Energy Segment Performance (Q1 2023 vs Q1 2022) | (in thousands) | Q1 2023 | Q1 2022 | Change | | :--- | :--- | :--- | :--- | | Revenue | $142,270 | $127,891 | $14,379 | | Adjusted gross margin | $86,982 | $82,449 | $4,533 | | **Operating income** | **$37,625** | **$34,681** | **$2,944** | Unregulated Energy Segment Performance (Q1 2023 vs Q1 2022) | (in thousands) | Q1 2023 | Q1 2022 | Change | | :--- | :--- | :--- | :--- | | Revenue | $83,165 | $101,292 | ($18,127) | | Adjusted gross margin | $42,594 | $43,284 | ($690) | | **Operating Income** | **$17,245** | **$20,046** | **($2,801)** | [Liquidity and Capital Resources](index=52&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with **$81.7 million** in Q1 2023 operating cash flow, **$41.8 million** in capital expenditures, and a full-year forecast of **$200-$230 million**, reducing short-term borrowings by **$107.8 million** through an **$80.0 million** Senior Notes issuance, maintaining a **53%** equity to total capitalization ratio 2023 Forecasted Capital Expenditures | (in thousands) | Low | High | | :--- | :--- | :--- | | Total Regulated Energy | $152,000 | $175,000 | | Total Unregulated Energy | $46,000 | $52,000 | | Corporate and other | $2,000 | $3,000 | | **Total 2023 Forecast** | **$200,000** | **$230,000** | * The company's target equity to total capitalization ratio (including short-term debt) is **50-60%**, with the ratio standing at **53%** as of March 31, 2023[424](index=424&type=chunk) * In Q1 2023, the company issued **$80.0 million of 5.43% Senior Notes due 2038** and used proceeds to reduce short-term borrowings under its Revolver credit facility[57](index=57&type=chunk)[368](index=368&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=57&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company manages interest rate risk through swaps and limits commodity price risk for regulated operations via fuel cost recovery mechanisms, while unregulated propane operations mitigate price fluctuations using storage, forward contracts, and derivatives * The company is exposed to interest rate risk on its debt, which is mitigated using interest rate swap agreements to manage potential increases in costs for new debt and variable-rate borrowings[374](index=374&type=chunk)[458](index=458&type=chunk) * Regulated energy distribution operations have limited commodity price risk due to authorized fuel cost recovery mechanisms[459](index=459&type=chunk) * Unregulated propane operations are exposed to commodity price risk, which is mitigated through storage, forward supply contracts, and the use of financial derivatives (fair value and cash flow hedges)[386](index=386&type=chunk)[437](index=437&type=chunk) [Item 4. Controls and Procedures](index=58&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of March 31, 2023, with no material changes to internal control over financial reporting during the quarter * The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of March 31, 2023[463](index=463&type=chunk) * No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[441](index=441&type=chunk) [PART II—OTHER INFORMATION](index=59&type=section&id=PART%20II%E2%80%94OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=59&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in legal actions, claims, and regulatory proceedings in the normal course of business, which management believes will not materially affect its financial position, results of operations, or cash flows * The company is involved in legal and regulatory proceedings in the normal course of business, but management does not expect them to have a material financial impact[391](index=391&type=chunk) [Item 1A. Risk Factors](index=59&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2022, and investors are advised to consider those factors * Refers to the risk factors described in the company's 2022 Annual Report on Form 10-K, indicating no material changes during the quarter[465](index=465&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=59&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q1 2023, the company purchased **503 shares** of its common stock on the open market at an average price of **$114.94 per share** for dividend reinvestment in the Rabbi Trust for the Non-Qualified Deferred Compensation Plan, not as part of a publicly announced repurchase program Share Repurchases (Q1 2023) | Period | Number of Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | Jan 1 - Jan 31, 2023 | 503 | $114.94 | | Feb 1 - Feb 28, 2023 | — | — | | Mar 1 - Mar 31, 2023 | — | — | | **Total** | **503** | **$114.94** | * Share purchases were made for the Rabbi Trust related to the Non-Qualified Deferred Compensation Plan and not as part of a formal buyback plan[396](index=396&type=chunk)

Chesapeake Utilities Corporation (NYSE:CPK) Q4 2022 Results Conference Call February 23, 2022 8:30 AM ET Company Participants Alex Whitelam - Head, IR Jeff Householder - President, CEO Beth Cooper - EVP, CFO, Treasurer & Assistant Corporate Secretary Jim Moriarty - EVP, General Counsel, Corporate Secretary & Chief Policy and Risk Officer Conference Call Participants Brian Russo - Sidoti & Company Chris Ellinghaus - Siebert Williams Shank Tate Sullivan - Maxim Group Operator Good day, everyone, and welcome ...

Chesapeake Utilities Corporation 2022 Form 10-K Page 8 Propane Operations - Operational Highlights Table of Contents Chesapeake Utilities Corporation 2022 Form 10-K Page 11 Table of Contents The risks described below fall into three broad categories related to (1) financial risks, (2) operational risks, and (3) regulatory, legal and environmental risks, all of which may affect our operations and/or the financial performance of our regulated and unregulated energy businesses. These are not the only risks we ...

Chesapeake Utilities Corporation (NYSE:CPK) Q3 2022 Earnings Conference Call November 3, 2022 4:00 PM ET Company Participants Alex Whitelam - Investor Relations Jeff Householder - President and Chief Executive Officer Beth Cooper - Executive Vice President, Chief Financial Officer, Treasurer and Assistant Corporate Secretary Jim Moriarty - Executive Vice President, General Counsel, Corporate Secretary and Chief Policy and Risk Officer Conference Call Participants Tate Sullivan - Maxim Group Brian Russo - Si ...

| --- | --- | |--------------------------|-------| | Third Quarter 2022 | | | Earnings Conference Call | | Today's Presenters | --- | --- | --- | --- | --- | --- | |-------|----------------------------------------------------------------------------------------------------------------------------|--------------------------------------|-------|-------|-------| | | | | | | | | | Jeff Householder | | | | | | | President, Chief Executive Officer | | | | | | | Beth Cooper Executive Vice President, Chief Financia ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: September 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-11590 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Secu ...

Financial Data and Key Metrics Changes - The company reported diluted earnings per share of $0.96 for the second quarter and $3.04 year-to-date, reflecting a 10.5% growth compared to the previous year [20][21] - Adjusted gross margins increased by approximately $8 million for the quarter and $16.8 million for the first half of the year [21][22] - Net income for the second quarter was $17.1 million, with a year-to-date increase of $5.7 million over the same period last year [21][22] Business Line Data and Key Metrics Changes - The Regulated Energy segment saw adjusted gross margin up 6.3% for the quarter and 5.8% year-over-year, driven by pipeline expansions and organic growth [25] - The Unregulated segment experienced a 21.2% increase in adjusted gross margin compared to last year's second quarter, primarily due to contributions from Diversified Energy and increased margins in propane distribution [26] Market Data and Key Metrics Changes - Customer growth in the Delmarva territory was 5.7%, while Florida saw 4.1% year-over-year growth, both above the national average [14] - The company surpassed 100,000 customer connections in Delmarva and is close to achieving the same milestone in Florida [12] Company Strategy and Development Direction - The company is focused on long-term sustainable growth, with significant opportunities for investment and earnings growth in its capital projects pipeline [12][43] - The company is pursuing renewable natural gas (RNG) investments to meet customer demand and support sustainability efforts [18] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges from inflation and supply chain constraints but remains optimistic about future investment opportunities [10][13] - The company adjusted its capital expenditure expectations for 2022 to a range of $140 million to $175 million due to project delays, but this is not seen as a negative outlook [39][41] Other Important Information - The company welcomed two new members to its Board of Directors, enhancing its leadership team [7][38] - The company has filed a rate case in Florida seeking a permanent increase of approximately $24.1 million, with interim rates approved [32] Q&A Session Summary Question: Insights on propane distribution business margins - Management indicated that higher margins are due to a combination of expanded fees from new customers and a diversified supply portfolio [46][48] Question: Impact of natural gas prices on customer conversions - Management noted that conversions from community gas systems to natural gas have not been significantly impacted, with challenges primarily related to homeowner agreements [49] Question: Breakdown of CapEx reduction between regulated and nonregulated - The most significant shifts relate to pipeline projects, with a larger decline in transmission side due to delays [52][53] Question: Customer growth breakdown in Delmarva - Management stated that significantly greater than 50% of customer growth comes from new home construction rather than conversions [57] Question: Accounting for interim rates in Florida - Management will evaluate the probability of permanent rates exceeding interim rates before booking earnings [61] Question: Regulatory strategy regarding inflationary pressures - Management is proactive in considering mechanisms to address inflationary pressures in their regulatory strategy [63][65]