WILLIAMSVILLE, N.Y., May 01, 2024 (GLOBE NEWSWIRE) -- National Fuel Gas Company ("National Fuel" or the "Company") (NYSE:NFG) today announced consolidated results for the second quarter of its 2024 fiscal year and for the six months ended March 31, 2024. FISCAL 2024 SECOND QUARTER SUMMARY GAAP net income of $166.3 million, or $1.80 per share, compared to GAAP net income of $140.9 million, or $1.53 per share, in the prior year, an increase of 18% per share.Adjusted operating results of $165.3 million, or $1. ...

Pennsylvania Large Gas Utilities Monthly Bill Residential Heating (based on 15 MCF monthly) 36 National Fuel" $150-$175 (2) (1) A reconciliation to Capital Expenditures as presented on the Consolidated Statement of Cash Flows is included at the end of this presentation. (2) Increase from previous guidance range of $130 to $150 MM is due to the estimated impact of New York State's Roadway Excavation Quality Assurance Act ("REQAA"). Long-Standing Pipeline Replacement & Modernization (1) All values are reporte ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 2023 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 1-3880 NATIONAL FUEL GAS COMPANY (Exact name of registrant as specified in its charter) | | | Name of Each Exchan ...

Part I [Business](index=6&type=section&id=ITEM%201%20BUSINESS) National Fuel Gas Company is a diversified energy company with an integrated business model spanning natural gas production, gathering, transportation, storage, and distribution, primarily focused on the Appalachian Basin [The Company and its Subsidiaries](index=6&type=section&id=THE%20COMPANY%20AND%20ITS%20SUBSIDIARIES) National Fuel Gas Company is a diversified energy holding company primarily engaged in the natural gas lifecycle, from production in the Appalachian Basin's Marcellus and Utica shales to distribution - The company's business is integrated across the natural gas value chain, with assets concentrated in western New York and Pennsylvania, focusing on production from the Marcellus and Utica shales[34](index=34&type=chunk) Key Subsidiaries and Operations | Segment | Subsidiary | Primary Operation | | :--- | :--- | :--- | | Exploration & Production | Seneca Resources Company, LLC | Natural gas exploration, development, and production in Appalachia | | Pipeline & Storage | National Fuel Gas Supply Corp., Empire Pipeline, Inc. | Interstate natural gas transportation and storage in PA and NY | | Gathering | National Fuel Gas Midstream Company, LLC | Natural gas processing and pipeline gathering facilities in Appalachia | | Utility | National Fuel Gas Distribution Corp. | Natural gas utility services to ~**754,000** customers in western NY and northwestern PA | [Rates and Regulation](index=7&type=section&id=RATES%20AND%20REGULATION) The company's Pipeline and Storage and Utility segments are extensively regulated by federal and state agencies, impacting rates, operations, and safety - The Pipeline and Storage segment (Supply Corporation, Empire) and the Utility segment (Distribution Corporation) are subject to rate regulation by FERC, NYPSC, and PaPUC, which approves the rates they can charge customers and impacts their return on assets[43](index=43&type=chunk) - The company is also subject to safety regulations from the Pipeline and Hazardous Materials Safety Administration (PHMSA) for its pipelines and storage facilities[45](index=45&type=chunk) [Competition](index=8&type=section&id=COMPETITION) The company faces diverse competition across all its segments, including other natural gas providers, alternative energy sources, and regional infrastructure - The Exploration and Production segment competes with other producers for mineral leaseholds and natural gas sales, utilizing strategies like operating its own prospects and maintaining a portfolio of firm transportation and sales contracts[60](index=60&type=chunk)[61](index=61&type=chunk) - The Pipeline and Storage segment's competitive position is enhanced by its strategic location near Marcellus and Utica shale production and its interconnections with other pipelines, providing access to markets in the U.S. and Canada[62](index=62&type=chunk) - The Utility segment faces growing competition from electrification alternatives, especially in New York due to the Climate Leadership & Community Protection Act (CLCPA), though natural gas currently maintains a competitive edge in reliability and affordability[67](index=67&type=chunk)[69](index=69&type=chunk) [Human Capital](index=11&type=section&id=HUMAN%20CAPITAL) As of September 30, 2023, the company employed 2,240 full-time employees, focusing on safety, development, and diversity, with an 8.7% voluntary attrition rate Employee Metrics (as of FY 2023) | Metric | Value | | :--- | :--- | | Full-time Employees | **2,240** | | Workforce under Collective Bargaining | **47%** | | Voluntary Attrition Rate (ex-retirements) | **8.7%** | | Work Stoppages | **0** | - The company emphasizes safety, tying executive compensation to safety-related goals, and provides various employee development resources, including training programs and tuition aid[77](index=77&type=chunk)[82](index=82&type=chunk) - Diversity, Equity, and Inclusion are key focuses, supported by non-discrimination policies, training, and multiple Employee Resource Groups for women, diverse employees, veterans, and LGBTQ+ individuals[83](index=83&type=chunk)[84](index=84&type=chunk) - The company operates as a diversified and integrated energy company with four primary business segments: Exploration and Production, Pipeline and Storage, Gathering, and Utility[34](index=34&type=chunk) FY 2023 Net Income (Loss) by Segment | Segment | Net Income (Loss) (in millions) | | :--- | :--- | | Exploration and Production | **$232.3** | | Pipeline and Storage | **$100.5** | | Gathering | **$99.7** | | Utility | **$48.4** | | All Other and Corporate | (**$4.0**) | - A single customer in the Exploration and Production segment accounted for approximately **9.6%** (**$208 million**) of the company's consolidated revenue in FY **2023**[40](index=40&type=chunk) [Risk Factors](index=14&type=section&id=ITEM%201A%20RISK%20FACTORS) The company faces significant strategic, financial, operational, and regulatory risks that could materially impact its business and financial performance - **Strategic Risk:** Climate change regulations, such as New York's CLCPA and the federal Inflation Reduction Act's methane charge, could impose significant costs, reduce demand for natural gas, and impact access to capital[90](index=90&type=chunk)[92](index=92&type=chunk)[93](index=93&type=chunk) - **Financial Risk:** Volatility in natural gas prices materially affects the Exploration and Production segment's profitability. The company uses hedging to mitigate this risk, but this can limit upside potential and create liquidity risks from margin calls in a rising price environment[104](index=104&type=chunk)[109](index=109&type=chunk)[110](index=110&type=chunk) - **Operational Risk:** The company's IT and operational technology systems are vulnerable to cybersecurity attacks, which could lead to business disruptions, data theft, and significant remediation costs[124](index=124&type=chunk) - **Regulatory Risk:** The company's regulated businesses (Utility, Pipeline & Storage) are subject to comprehensive oversight from FERC, NYPSC, and PaPUC. Failure to obtain approval for requested rates to cover increased costs could decrease earnings[132](index=132&type=chunk)[135](index=135&type=chunk)[136](index=136&type=chunk) [Properties](index=25&type=section&id=ITEM%202%20PROPERTIES) As of September 30, 2023, the company's net property, plant, and equipment totaled $7.3 billion, primarily in Appalachia, with proved natural gas reserves of 4,535 Bcf Net Property, Plant & Equipment by Segment (as of Sept 30, 2023) | Segment | Net Investment (in billions) | Percentage of Total | | :--- | :--- | :--- | | Exploration and Production | **$2.6** | **35.0%** | | Pipeline and Storage | **$2.1** | ~**28.8%** | | Utility | **$1.7** | ~**23.3%** | | Gathering | **$0.9** | **12.2%** | | **Total** | **$7.3** | ~**100%** | - Seneca's proved developed and undeveloped natural gas reserves increased from **4,171 Bcf** at September **30**, **2022** to **4,535 Bcf** at September **30**, **2023**, primarily due to extensions and discoveries of **670 Bcf**[157](index=157&type=chunk) Appalachian Region Production Statistics (FY 2023) | Metric | Value | | :--- | :--- | | Average Sales Price per Mcf of Gas (after hedging) | **$2.55** | | Average Production Cost per Mcfe | **$0.68** | | Average Daily Production (MMcfe) | **1,020** | [Legal Proceedings](index=30&type=section&id=ITEM%203%20LEGAL%20PROCEEDINGS) This section refers the reader to other parts of the report for discussions on environmental, rate, and other legal matters - For information on environmental and other legal matters, the report directs readers to Item **7**, MD&A and Item **8**, Note L[174](index=174&type=chunk) [Mine Safety Disclosures](index=30&type=section&id=ITEM%204%20MINE%20SAFETY%20DISCLOSURES) This section is not applicable to the company's operations - The company reports that Mine Safety Disclosures are not applicable[174](index=174&type=chunk) Part II [Market for Common Equity, Stockholder Matters and Issuer Purchases](index=31&type=section&id=ITEM%205%20MARKET%20FOR%20THE%20REGISTRANT%27S%20COMMON%20EQUITY%2C%20RELATED%20STOCKHOLDER%20MATTERS%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES) The company's common stock trades on the NYSE (NFG), with 8,751 shareholders as of September 30, 2023, and 40,942 shares purchased for 401(k) plans during the quarter - The company's common stock is listed on the New York Stock Exchange (Symbol: NFG), with **8,751** registered shareholders as of September **30**, **2023**[176](index=176&type=chunk) Issuer Purchases of Equity Securities (Quarter Ended Sept 30, 2023) | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | July **2023** | **14,954** | **$51.00** | | Aug **2023** | **12,495** | **$53.88** | | Sept **2023** | **13,493** | **$51.42** | | **Total** | **40,942** | **$52.10** | - No shares were purchased under the publicly announced share repurchase program during the quarter; the purchases were primarily for the company's **401(k)** plans[178](index=178&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=33&type=section&id=ITEM%207%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) The MD&A reviews the company's FY2023 financial performance, detailing decreased consolidated earnings, segment results, cash flows, and capital expenditures [Critical Accounting Estimates](index=35&type=section&id=CRITICAL%20ACCOUNTING%20ESTIMATES) The company's critical accounting estimates include oil and gas exploration and development costs, subject to a natural gas price-sensitive ceiling test, and regulation, involving judgment for deferring costs as regulatory assets - The company uses the full cost method of accounting for its Exploration and Production segment, which capitalizes all costs associated with property acquisition, exploration, and development[202](index=202&type=chunk) - A quarterly SEC full cost ceiling test is performed to limit capitalized costs. At September **30**, **2023**, the ceiling exceeded the book value of oil and gas properties by approximately **$794.7 million**, indicating no impairment[205](index=205&type=chunk) - A sensitivity analysis shows that if natural gas prices were **$0.25** per MMBtu lower, the ceiling would still have exceeded the book value by approximately **$442.9 million**, and no impairment would have been recorded[205](index=205&type=chunk) [Results of Operations](index=37&type=section&id=RESULTS%20OF%20OPERATIONS) Consolidated earnings decreased by $89.1 million in FY2023 to $476.9 million, primarily driven by lower Exploration & Production segment earnings due to asset sales and natural gas prices Earnings by Segment (FY 2023 vs. FY 2022) | Segment | 2023 Earnings (in millions) | 2022 Earnings (in millions) | Change (in millions) | | :--- | :--- | :--- | :--- | | Exploration and Production | **$232.3** | **$306.1** | (**$73.8**) | | Pipeline and Storage | **$100.5** | **$102.6** | (**$2.1**) | | Gathering | **$99.7** | **$101.1** | (**$1.4**) | | Utility | **$48.4** | **$68.9** | (**$20.5**) | | **Total Consolidated** | **$476.9** | **$566.0** | (**$89.1**) | [Capital Resources and Liquidity](index=45&type=section&id=CAPITAL%20RESOURCES%20AND%20LIQUIDITY) In FY2023, net cash from operating activities increased to $1.24 billion, funding $1.01 billion in capital expenditures, with the company maintaining a $1.0 billion credit facility for liquidity Condensed Statement of Cash Flows (in millions) | Activity | FY 2023 | FY 2022 | | :--- | :--- | :--- | | Net Cash from Operating Activities | **$1,237.1** | **$812.5** | | Net Cash Used in Investing Activities | (**$1,112.3**) | (**$518.7**) | | Net Cash Used in Financing Activities | (**$207.0**) | (**$276.2**) | Capital Expenditures by Segment (FY 2023) | Segment | Capital Expenditures (in millions) | | :--- | :--- | | Exploration and Production | **$737.7** | | Pipeline and Storage | **$141.9** | | Gathering | **$103.3** | | Utility | **$139.9** | | **Total** | **$1,122.8** | - The company maintains a **$1.0 billion** unsecured committed revolving credit facility maturing in February **2027**. As of September **30**, **2023**, the debt-to-capitalization ratio was **0.46**, well below the **0.65** covenant limit[290](index=290&type=chunk)[294](index=294&type=chunk) Consolidated Earnings Comparison | Fiscal Year | Net Earnings (in millions) | | :--- | :--- | | **2023** | **$476.9** | | **2022** | **$566.0** | - Key activities in FY**2023** included the acquisition of upstream assets from SWN Production Company for **$124.8 million**, continued development of the Tioga Pathway pipeline project, and rate case proceedings in Pennsylvania and New York[192](index=192&type=chunk)[193](index=193&type=chunk)[194](index=194&type=chunk) - Cash from operations increased to **$1.24 billion** in **2023** from **$812.5 million** in **2022**, driven by higher cash receipts in the Exploration & Production and Utility segments[252](index=252&type=chunk)[258](index=258&type=chunk) - Capital expenditures are projected to be approximately **$920 million** in FY**2024**, with the largest allocation to the Exploration and Production segment for well drilling and completion[276](index=276&type=chunk) [Financial Statements and Supplementary Data](index=62&type=section&id=ITEM%208%20FINANCIAL%20STATEMENTS%20AND%20SUPPLEMENTARY%20DATA) This section presents the company's audited consolidated financial statements for fiscal years 2021-2023, along with detailed notes and the independent auditor's report Consolidated Financial Highlights (FY 2023 vs FY 2022) | Metric (in thousands) | Sept 30, 2023 | Sept 30, 2022 | | :--- | :--- | :--- | | **Income Statement** | | | | Operating Revenues | **$2,173,771** | **$2,186,046** | | Operating Income | **$755,147** | **$814,516** | | Net Income | **$476,866** | **$566,021** | | Diluted EPS | **$5.17** | **$6.15** | | **Balance Sheet** | | | | Total Assets | **$8,280,260** | **$7,896,262** | | Total Long-Term Debt (Net) | **$2,384,485** | **$2,083,409** | | Total Comprehensive Shareholders' Equity | **$2,963,376** | **$2,079,896** | - The independent auditor, PricewaterhouseCoopers LLP, issued an unqualified opinion on the financial statements and the effectiveness of internal control over financial reporting. A critical audit matter identified was the impact of proved natural gas reserve estimates on the valuation of natural gas properties[356](index=356&type=chunk)[363](index=363&type=chunk) [Controls and Procedures](index=125&type=section&id=ITEM%209A%20CONTROLS%20AND%20PROCEDURES) Management and the independent auditor concluded that the company's disclosure controls and internal control over financial reporting were effective as of September 30, 2023 - The CEO and Principal Financial Officer concluded that the company's disclosure controls and procedures were effective as of September **30**, **2023**[684](index=684&type=chunk) - Management's assessment, based on the COSO framework, concluded that the company maintained effective internal control over financial reporting as of September **30**, **2023**[686](index=686&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=126&type=section&id=ITEM%2010%20DIRECTORS%2C%20EXECUTIVE%20OFFICERS%20AND%20CORPORATE%20GOVERNANCE) Information regarding directors and corporate governance is incorporated by reference from the definitive Proxy Statement to be filed later - Information regarding directors and corporate governance is incorporated by reference from the definitive Proxy Statement to be filed later[692](index=692&type=chunk) [Executive Compensation](index=126&type=section&id=ITEM%2011%20EXECUTIVE%20COMPENSATION) Information concerning executive compensation is incorporated by reference from the company's definitive Proxy Statement for its 2024 Annual Meeting of Stockholders - Details on executive compensation are incorporated by reference from the definitive Proxy Statement[695](index=695&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=126&type=section&id=ITEM%2012%20SECURITY%20OWNERSHIP%20OF%20CERTAIN%20BENEFICIAL%20OWNERS%20AND%20MANAGEMENT%20AND%20RELATED%20STOCKHOLDER%20MATTERS) This section incorporates information regarding equity compensation plans and security ownership of beneficial owners and management by reference from the company's definitive Proxy Statement for its 2024 Annual Meeting of Stockholders - Information on equity compensation plans and security ownership is incorporated by reference from the definitive Proxy Statement[696](index=696&type=chunk)[697](index=697&type=chunk)[698](index=698&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=126&type=section&id=ITEM%2013%20CERTAIN%20RELATIONSHIPS%20AND%20RELATED%20TRANSACTIONS%2C%20AND%20DIRECTOR%20INDEPENDENCE) Information regarding related person transactions and director independence is incorporated by reference from the company's definitive Proxy Statement for its 2024 Annual Meeting of Stockholders - Details on related party transactions and director independence are incorporated by reference from the definitive Proxy Statement[700](index=700&type=chunk) [Principal Accountant Fees and Services](index=127&type=section&id=ITEM%2014%20PRINCIPAL%20ACCOUNTANT%20FEES%20AND%20SERVICES) Information concerning principal accountant fees and services is incorporated by reference from the company's definitive Proxy Statement for its 2024 Annual Meeting of Stockholders - Information on principal accountant fees and services is incorporated by reference from the definitive Proxy Statement[702](index=702&type=chunk) Part IV [Exhibits and Financial Statement Schedules](index=127&type=section&id=ITEM%2015%20EXHIBITS%20AND%20FINANCIAL%20STATEMENT%20SCHEDULES) This section lists the financial statements, financial statement schedules, and exhibits filed as part of the Form 10-K report - This section provides an index of all exhibits filed with the **10-K**, including governance documents, material contracts, and required certifications[706](index=706&type=chunk)

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National Fuel Gas Co (NYSE:NFG) Q3 2023 Earnings Conference Call August 3, 2023 10:00 AM ET Company Participants Brandon Haspett - Director, IR David Bauer - President, CEO & Director Justin Loweth - President, National Fuel Gas Midstream Company, LLC & Seneca Resources Company, LLC Timothy Silverstein - Principal Financial Officer & Treasurer Conference Call Participants Umang Choudhary - Goldman Sachs Group John Abbott - Bank of America Merrill Lynch Trafford Lamar - Raymond James Operator Thank you for s ...

Revenue Performance - Utility revenues for Q3 2023 were $144.5 million, down 19.7% from $179.9 million in Q3 2022[12] - Exploration and production revenues decreased to $216.6 million in Q3 2023, a decline of 14.3% compared to $252.6 million in Q3 2022[12] - Total revenues for the quarter ended June 30, 2023, amounted to $428.7 million, with natural gas production contributing $157.7 million[46] - For the nine months ended June 30, 2023, total revenues reached $1.8 billion, with natural gas residential sales accounting for $671.4 million[47] - The Company reported a total of $1.9 billion in revenues from contracts with customers for the nine months ended June 30, 2023[47] - Total revenues for the nine months ended June 30, 2022, amounted to $1,750.9 million, with significant contributions from natural gas production ($1,189.9 million) and residential sales ($604.3 million)[50] Net Income and Earnings - Net income available for common stock for Q3 2023 was $92.6 million, a decrease of 14.4% from $108.2 million in Q3 2022[13] - Earnings per common share for Q3 2023 were $1.01, down from $1.18 in Q3 2022[12] - Net income available for common stock for the nine months ended June 30, 2023, was $403,189,000, slightly down from $407,879,000 in the same period of 2022[22] - The company recorded a net periodic benefit income of $3.466 million for the nine months ended June 30, 2023, compared to a cost of $20.982 million for the same period in 2022[94] Comprehensive Income and Shareholder Equity - Comprehensive income for the nine months ended June 30, 2023, was $979.5 million, compared to $338.6 million in the same period of 2022[13] - Total comprehensive shareholders' equity rose to $2,935,902,000 as of June 30, 2023, from $2,079,896,000 in September 30, 2022, marking an increase of approximately 41.1%[20] Cash Flow and Investments - Net cash provided by operating activities was $1,055,112,000 for the nine months ended June 30, 2023, compared to $654,016,000 for the same period in 2022, indicating a significant increase of approximately 61.3%[22] - The company reported a net cash used in investing activities of $829,099,000 for the nine months ended June 30, 2023, compared to $294,520,000 in the same period of 2022, indicating a significant increase in investment outflows[22] - Cash and temporary cash investments at June 30, 2023, were $53,415,000, up from $46,048,000 in the previous year, showing an increase of approximately 16.4%[22] Capital Expenditures and Debt - Capital expenditures for the nine months ended June 30, 2023, totaled $727,738,000, up from $592,487,000 in the prior year, representing an increase of about 22.8%[22] - Long-term debt, net of current portion, increased to $2,383,685,000 as of June 30, 2023, compared to $2,083,409,000 in September 30, 2022, reflecting a rise of about 14.4%[20] Asset Management - Total assets increased to $8,106,632,000 as of June 30, 2023, compared to $7,896,262,000 in September 30, 2022, reflecting a growth of approximately 2.66%[20] - The company’s total segment assets amounted to $8,269,844 thousand, an increase from $7,896,262 thousand at September 30, 2022[90] Shareholder Returns and Dividends - Dividends declared per common share increased to $0.495 in Q3 2023 from $0.475 in Q3 2022[12] - The company declared dividends on common stock amounting to $45,444 thousand for the quarter, translating to $0.495 per share[79] Performance Shares and Compensation - The company granted 202,259 performance shares during the nine months ended June 30, 2023, with a weighted average fair value of $64.28 per share[38] - The Company granted 125,673 restricted stock units with a weighted average fair value of $58.67 per share for the nine months ended June 30, 2023[42] Regulatory and Rate Changes - A rate increase of $23 million was authorized by the Pennsylvania Public Utility Commission (PaPUC) effective August 1, 2023, following a settlement agreement[99] - The New York Public Service Commission (NYPSC) approved a pension and OPEB surcredit to customers effective October 1, 2022, which will remain in effect until December 31, 2024, or until modified[96] Environmental and Cleanup Costs - The company has estimated remaining environmental clean-up costs of approximately $3.6 million related to former manufactured gas plant sites[85] Derivative Financial Instruments - The Company reported derivative financial instruments with a total fair value of $114.9 million as of June 30, 2023, with Level 2 assets amounting to $106.6 million[55] - The fair value of the Company's derivative financial instruments includes natural gas price swaps and no-cost collars, which are utilized in the Exploration and Production segment[58]

National Fuel Gas Company (NYSE:NFG) Q2 2023 Earnings Conference Call May 4, 2023 11:00 AM ET Company Participants Brandon Haspett - Director, Investor Relations Dave Bauer - President and CEO Tim Silverstein - Treasurer and Principal Financial Officer Justin Loweth - President, Seneca Resources and National Fuel Midstream Conference Call Participants Trafford Lamar - Raymond James Timothy Winter - Gabelli & Company Operator Good afternoon, everyone. I would like to welcome you all to the National Fuel Gas ...

Financial Performance - Utility revenues for Q2 2023 reached $406.758 million, up from $369.092 million in Q2 2022, representing a 10.5% increase[11] - Exploration and production revenues decreased to $244.552 million in Q2 2023 from $261.676 million in Q2 2022, a decline of 6.5%[11] - Net income available for common stock for the six months ended March 31, 2023, was $310.570 million, compared to $299.720 million for the same period in 2022, reflecting a 3.0% increase[12] - The company reported operating income of $221.377 million for Q2 2023, down from $246.366 million in Q2 2022, a decrease of 10.1%[11] - Total operating revenues for the six months ended March 31, 2023, were $1.376 billion, compared to $1.248 billion for the same period in 2022, indicating a 10.2% growth[11] - The company’s basic earnings per share for Q2 2023 was $1.53, compared to $1.83 in Q2 2022, a decrease of 16.4%[11] - Comprehensive income for the six months ended March 31, 2023, was $881.439 million, significantly higher than $159.063 million for the same period in 2022[12] Assets and Liabilities - Total assets increased to $7,967,242 thousand as of March 31, 2023, compared to $7,896,262 thousand as of September 30, 2022, reflecting a growth of approximately 0.9%[19] - Long-term debt, net of current portion, was $2,085,235 thousand as of March 31, 2023, slightly up from $2,083,409 thousand as of September 30, 2022[19] - The company reported a reduction in accounts payable to $119,497 thousand as of March 31, 2023, down from $178,945 thousand as of September 30, 2022, reflecting improved cash management[19] - The fair value of derivative financial instruments increased to $42,424 thousand as of March 31, 2023, compared to $9,175 thousand as of September 30, 2022, indicating a significant rise in financial instrument valuations[19] Cash Flow and Investments - Net cash provided by operating activities for the six months ended March 31, 2023, was $711,209 thousand, compared to $425,619 thousand for the same period in 2022, indicating a significant increase of approximately 67.2%[21] - Cash and temporary cash investments increased to $71,533 thousand as of March 31, 2023, from $46,048 thousand as of September 30, 2022, representing a growth of about 55.5%[21] - The Company’s other investments totaled $74.6 million as of March 31, 2023, down from $95.0 million as of September 30, 2022[62] Capital Expenditures - Capital expenditures for the six months ended March 31, 2023, totaled $496,362 thousand, compared to $415,415 thousand for the same period in 2022, reflecting an increase of about 19.5%[21] - Capitalized costs related to oil and gas producing activities rose to $2.2 billion at March 31, 2023, up from $1.9 billion at September 30, 2022, indicating a 15.8% increase[30] Shareholder Returns - The company declared dividends of $0.475 per common share for Q2 2023, up from $0.455 in Q2 2022, a rise of 4.4%[11] - Total comprehensive shareholders' equity rose to $2,878,726 thousand as of March 31, 2023, from $2,079,896 thousand as of September 30, 2022, marking an increase of approximately 38.4%[19] Environmental and Regulatory Matters - The Company aims to reduce methane emissions and total greenhouse gas emissions as part of its ESG performance goals, with specific targets set by the Compensation Committee[40] - The Company has estimated remaining environmental clean-up costs of approximately $3.8 million, which are expected to be recovered through rate recovery within one year[84] - A settlement approved by the PaPUC allows for an increase in annual base rate operating revenues of $23 million effective August 1, 2023[97] Derivative Financial Instruments - The Company reported derivative financial instruments with a total fair value of $127.8 million as of March 31, 2023, with Level 2 inputs primarily from natural gas price swaps and foreign currency contracts[54] - The fair value of derivative financial instruments classified as Level 2 included $91.5 million in over-the-counter swaps and $21.6 million in no-cost collars as of March 31, 2023[54] Taxation - The effective tax rate for the quarter ended March 31, 2023, was 26.2%, compared to 25.6% for the same quarter in 2022[76] Miscellaneous - The Company entered into a purchase agreement to acquire upstream assets in Pennsylvania for a total consideration of $127.0 million, expected to close by June 2023[43] - The sale of California assets was completed for $253.5 million, with potential contingent payments up to $10 million per year from 2023 to 2025 based on commodity prices[44]

Financial Data and Key Metrics Changes - The company reported adjusted operating results of $1.84 per share, a 24% increase compared to the previous year [17][59] - EBITDA increased by 29% due to an 11% rise in production in Appalachia and a $0.50 per Mcf improvement in natural gas price realizations [60] - Full-year earnings guidance was lowered to a range of $5.35 to $5.75 per share, primarily due to a drop in natural gas prices [20] Business Line Data and Key Metrics Changes - Seneca's production increased by 11%, contributing to a 6% increase in gathering EBITDA [60][85] - The Utility business saw an increase in underlying customer margin by about $6 million, driven by infrastructure modernization and increased usage due to colder weather [64] Market Data and Key Metrics Changes - The company expects NYMEX pricing to average $3.25 per MMBtu for the last three quarters of the year, a significant decrease from previous estimates [20][66] - The Appalachian basis differentials are expected to average $1 per MMBtu for the remainder of the year, showing modest improvement [20] Company Strategy and Development Direction - The company remains committed to a disciplined hedging strategy to protect earnings and cash flows from commodity price volatility [67] - Long-term growth is anticipated due to new LNG export facilities coming online and a transition from coal to gas generation [65][68] - The company is focused on balancing capital efficiency, growth, and free cash flow generation [51] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about long-term natural gas pricing, particularly in fiscal '25 and beyond [12] - The company highlighted the challenges posed by New York's Climate Action Council's scoping plan, which could lead to increased electricity demand without guaranteed reliability [72][77] - Management emphasized the importance of resilient infrastructure, especially in light of recent extreme weather events [70][71] Other Important Information - The company has hedges in place for nearly 70% of expected remaining fiscal '23 natural gas production, with only about 10% exposed to in-basin pricing [4][21] - Capital spending guidance remains unchanged at $830 million to $940 million for the full year [22][65] Q&A Session Summary Question: Potential deal opportunities and funding - Management indicated that any potential deal would ideally be of a size manageable within the balance sheet or with modest equity involvement [30][31] Question: Future cash taxes - Cash taxes are expected to increase to the lower teens based on current strip pricing for 2024 and 2025 [33] Question: CapEx and inflation environment - Service costs have likely peaked, and the company feels insulated from further inflation due to locked-in contracts [36][37] Question: Bolt-on opportunities for Seneca - The company remains interested in opportunities that fit well with existing acreage and has not seen many new opportunities due to market volatility [38][39] Question: Engagement with regulators on decarbonization - Management is actively participating in discussions with regulators regarding the future of the gas business and has made constructive filings [44]