May 2025 Investor Presentation Fiscal 2025 Second Quarter and Year-to-Date Financial Results Non-GAAP Measures This presentation includes the non-GAAP financial measures NFE/net financial loss, NFE per basic share, financial margin, utility gross margin, adjusted funds from operations and adjusted debt. 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 ...

Company Performance - New Jersey Resources (NJR) reported quarterly earnings of $1.76 per share, exceeding the Zacks Consensus Estimate of $1.65 per share, and up from $1.40 per share a year ago, representing an earnings surprise of 6.67% [1] - The company posted revenues of $913.03 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 24.78%, compared to year-ago revenues of $657.91 million [2] - Over the last four quarters, NJR has surpassed consensus EPS estimates two times and topped consensus revenue estimates two times [2] Stock Performance - NJR shares have increased approximately 6.2% since the beginning of the year, while the S&P 500 has declined by 3.3% [3] - The current consensus EPS estimate for the upcoming quarter is -$0.07 on revenues of $292.42 million, and for the current fiscal year, it is $3.14 on revenues of $1.86 billion [7] Industry Outlook - The Utility - Gas Distribution industry, to which NJR belongs, is currently ranked in the top 12% of over 250 Zacks industries, indicating a favorable outlook [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that the industry outlook can significantly impact stock performance [5][8]

Financial Performance - Fiscal 2025 second-quarter consolidated net income was $204.3 million, or $2.04 per share, compared to $120.8 million, or $1.23 per share, in the same period of fiscal 2024, representing a 69% increase in net income [6]. - Year-to-date net income for fiscal 2025 totaled $335.6 million, or $3.35 per share, compared to $210.2 million, or $2.14 per share, for the same period in fiscal 2024, indicating a 60% increase [6]. - Net income for the three months ended March 31, 2025, was $204.3 million, representing a 69.2% increase from $120.8 million in the same quarter of 2024 [32]. - Net income for the six months ended March 31, 2025, was $335.6 million, compared to $210.2 million for the same period in 2024, marking a 59.7% increase [40]. - Net income for Energy Services was $61.292 million, compared to $17.028 million in the previous year, representing a 260.5% increase [44]. Revenue and Earnings Guidance - The company raised its fiscal 2025 net financial earnings per share (NFEPS) guidance to a range of $3.15 to $3.30, up from $3.05 to $3.20, reflecting a $0.10 increase due to strong performance from Energy Services [8]. - NJR's total operating revenues for the three months ended March 31, 2025, increased to $913.0 million, up 38.7% from $657.9 million in the same period of 2024 [32]. - Total operating revenues for the three months ended March 31, 2025, increased to $913.0 million, up 38.7% from $657.9 million in the same period of 2024 [40]. - NJR's nonutility operating revenues for the three months ended March 31, 2025, were $294.7 million, up 51.0% from $195.1 million in the same quarter of 2024 [32]. Operating Income and Margins - The company reported a total operating income of $279.9 million for the three months ended March 31, 2025, compared to $170.2 million in the same period of 2024, marking a 64.5% increase [32]. - Utility gross margin for the three months ended March 31, 2025, was $294.8 million, a 29.7% increase compared to $227.3 million in the prior year [36]. - Total Utility Gross Margin for the second quarter of fiscal 2025 was $294.846 million, up from $227.297 million in the same period last year, representing a 29.7% increase [43]. - Operating Income for the second quarter was $197.876 million, compared to $140.279 million in the prior year, reflecting a 40.9% growth [43]. Customer and Service Metrics - NJNG serviced approximately 588,000 customers as of March 31, 2025, an increase from approximately 583,000 customers at September 30, 2024 [12]. - Total Customers reached 588,164, up from 581,600, indicating a growth of 1.4% [43]. - Throughput for NJNG core customers was 35.7 Bcf in Q2 2025, an increase from 32.9 Bcf in Q2 2024, indicating a growth of 8.5% [40]. - Total throughput for the company decreased to 93.0 Bcf in Q2 2025 from 108.3 Bcf in Q2 2024, a decline of 14.0% [40]. Capital Expenditures and Cash Flow - Capital expenditures for the first six months of fiscal 2025 were $287.1 million, compared to $232.6 million during the same period in fiscal 2024, reflecting a 23% increase [21]. - Cash flows from operations for the first six months of fiscal 2025 were $414.1 million, compared to $338.6 million during the same period in fiscal 2024, a 22% increase [21]. Segment Performance - New Jersey Natural Gas reported second-quarter fiscal 2025 NFE of $144.5 million, up from $107.1 million in the same period of fiscal 2024, a 35% increase [11]. - Clean Energy Ventures reported a year-to-date NFE of $44.2 million, compared to $4.9 million for the same period in fiscal 2024, a significant increase attributed to the gain on the sale of its residential solar portfolio [16]. - Energy Services reported second-quarter fiscal 2025 NFE of $35.3 million, down from $37.6 million in the same period of fiscal 2024, a decrease of 6% [18]. - Clean Energy Ventures segment reported a net loss of $3.96 million in Q2 2025, an improvement from a loss of $5.62 million in Q2 2024 [40]. - Energy Services segment's operating income increased to $83.3 million in Q2 2025, compared to $25.5 million in Q2 2024, reflecting a significant growth of 226.5% [40]. Market Capitalization and Stock Performance - The company reported a total market capitalization of approximately $4.92 billion as of March 31, 2025 [41]. - The company’s stock price was $49.06 per share at the end of March 31, 2025, compared to $42.91 per share at the same time in 2024 [41]. Investment Programs - The Infrastructure Investment Program (IIP) consists of a five-year, $150 million accelerated recovery program, with $16.1 million spent in the first six months of fiscal 2025 [12]. Non-GAAP Measures - Management emphasizes the importance of non-GAAP financial measures for providing a clearer understanding of NJR's performance and business model [27].

Core Viewpoint - The market anticipates New Jersey Resources (NJR) will report a year-over-year increase in earnings driven by higher revenues for the quarter ending March 2025, with actual results being crucial for stock price movement [1][2]. Earnings Expectations - NJR is expected to post quarterly earnings of $1.65 per share, reflecting a year-over-year increase of +17.9%, and revenues are projected to be $731.72 million, up 11.2% from the previous year [3]. Estimate Revisions - The consensus EPS estimate has been revised 750% lower in the last 30 days, indicating a significant reassessment by analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that the Most Accurate Estimate is higher than the Zacks Consensus Estimate, resulting in an Earnings ESP of +1.21%, indicating a likelihood of beating the consensus EPS estimate [10][11]. Historical Performance - In the last reported quarter, NJR exceeded the expected earnings of $1.14 per share by delivering $1.29, resulting in a surprise of +13.16%. Over the last four quarters, the company has beaten consensus EPS estimates two times [12][13]. Investment Considerations - While NJR appears to be a strong candidate for an earnings beat, other factors should also be considered when making investment decisions [14][16].

Company Performance - DTE Energy has gained approximately 12.8% year-to-date, outperforming the average Utilities sector gain of about 5.6% [4] - The Zacks Consensus Estimate for DTE's full-year earnings has increased by 0.3% over the past three months, indicating improved analyst sentiment and a stronger earnings outlook [3] Industry Comparison - DTE Energy belongs to the Utility - Electric Power industry, which includes 60 stocks and currently ranks 34 in the Zacks Industry Rank, with an average gain of 6.3% year-to-date [5] - In contrast, New Jersey Resources, which belongs to the Utility - Gas Distribution industry, has a lower industry rank of 63 and has seen a decline of 2.9% year-to-date [6] Zacks Rank - DTE Energy holds a Zacks Rank of 2 (Buy), suggesting it is positioned to outperform the market in the near term [3] - New Jersey Resources also has a Zacks Rank of 2 (Buy), with a consensus EPS estimate increase of 1.6% over the past three months [5]

Core Viewpoint - New Jersey Resources (NJR) has received an upgrade to a Zacks Rank 2 (Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on changes in a company's earnings outlook, which is crucial for predicting near-term stock price movements [2][4]. - The correlation between earnings estimate revisions and stock price movements is strong, with institutional investors using these estimates to determine fair value [4]. Company Performance Indicators - New Jersey Resources is projected to earn $3.14 per share for the fiscal year ending September 2025, reflecting a year-over-year increase of 7.2% [8]. - Over the past three months, the Zacks Consensus Estimate for New Jersey Resources has risen by 1.6% [8]. Zacks Rating System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a proven track record of performance, particularly for Zacks Rank 1 stocks, which have averaged a +25% annual return since 1988 [7]. - The upgrade to Zacks Rank 2 places New Jersey Resources in the top 20% of Zacks-covered stocks, indicating strong potential for market-beating returns in the near term [10].

Group 1 - South Jersey Industries was publicly traded until February 2023 when it was taken private by JP Morgan's Infrastructure Investments Fund [1] - The company had been a favorite holding for many years among certain investors [1] - The financial markets are considered efficient, with most stocks reflecting their real current value, suggesting that less-followed stocks may present better profit opportunities [1] Group 2 - The article expresses personal opinions and does not provide any recommendations or advice regarding investment suitability [2][3] - There is no current stock, option, or similar derivative position in any of the companies mentioned, but there may be plans to initiate a long position in NJR within the next 72 hours [2]

Company Overview - New Jersey Resources (NJR) is a notable stock within the Utilities sector, which consists of 104 individual stocks and ranks 3 in the Zacks Sector Rank [2] - NJR currently holds a Zacks Rank of 2 (Buy), indicating a favorable outlook based on earnings estimate revisions and improving earnings outlooks [3] Performance Analysis - Over the past 90 days, the Zacks Consensus Estimate for NJR's full-year earnings has increased by 3.1%, reflecting improved analyst sentiment [4] - Year-to-date, NJR has returned approximately 3.5%, outperforming the average return of 2.5% for Utilities companies [4] - NJR belongs to the Utility - Gas Distribution industry, which ranks 27 in the Zacks Industry Rank, while this industry has seen an average loss of 5.8% year-to-date, further highlighting NJR's strong performance [6] Comparison with Peers - Another outperforming stock in the Utilities sector is OGE Energy (OGE), which has returned 8.2% year-to-date and also holds a Zacks Rank of 2 (Buy) [5] - OGE Energy is part of the Utility - Electric Power industry, currently ranked 82, which has seen a year-to-date increase of 2.7% [6] Investment Outlook - Both New Jersey Resources and OGE Energy are positioned for continued solid performance, making them attractive options for investors interested in Utilities stocks [7]

Financial Performance - Total operating revenues increased to $488,361,000 in Q4 2024 from $467,210,000 in Q4 2023, representing a growth of 2.45%[16] - Operating income rose to $189,577,000 in Q4 2024, up from $135,819,000 in Q4 2023, marking an increase of 39.5%[16] - Net income for Q4 2024 was $131,319,000, compared to $89,411,000 in Q4 2023, reflecting a significant increase of 46.8%[16] - Basic earnings per share improved to $1.32 in Q4 2024 from $0.91 in Q4 2023, an increase of 45.1%[16] - The company reported comprehensive income of $131,387,000 for Q4 2024, compared to $89,806,000 in Q4 2023, an increase of 46.2%[17] - Consolidated net income for the three months ended December 31, 2024, was $131.3 million, a 47% increase from $89.4 million in the same period of 2023[191] - NJNG reported net income of $66.9 million, representing a 30% increase from $51.4 million year-over-year[191] - CEV's net income increased to $48.1 million from $10.5 million, reflecting a significant growth driven by the sale of its residential solar asset portfolio[191] Cash Flow and Assets - Cash flows used in operating activities were $(8,955,000) in Q4 2024, a decrease from $46,415,000 in Q4 2023[20] - Total assets increased to $7,193,965,000 as of December 31, 2024, compared to $6,981,645,000 as of September 30, 2024, showing a growth of 3.03%[22] - The company’s cash and cash equivalents at the end of Q4 2024 were $2,563,000, down from $3,429,000 at the end of Q4 2023[20] - The total cash and cash equivalents as of December 31, 2024, amount to $1,908 million, an increase from $1,017 million as of September 30, 2024[49] - Total assets as of December 31, 2024, reached $7.19 billion, up approximately $212.3 million from $6.98 billion as of September 30, 2024[193] Liabilities and Debt - Long-term debt rose to $2,989,473,000 in Q4 2024 from $2,879,464,000 in Q3 2024, an increase of 3.84%[24] - Total current liabilities decreased to $818,665,000 in Q4 2024 from $887,774,000 in Q3 2024, a reduction of 7.77%[24] - NJNG's bank revolving credit facility had an outstanding balance of $143,900,000 as of December 31, 2024, with a weighted average interest rate of 4.67%[127] - The estimated fair value of long-term debt as of December 31, 2024, was $2,391,501,000, compared to a carrying value of $2,767,845,000[114] Revenue Streams - Revenues from natural gas utility sales increased to $296.402 million in 2024, up from $257.875 million in 2023, representing a growth of 14.9%[74] - Total revenues from residential customers increased to $241.473 million in 2024, compared to $213.812 million in 2023, marking an increase of 12.9%[78] - The company recognized $4.9 million and $9.5 million of operating revenue related to pipeline capacity agreements during the three months ended December 31, 2024, and 2023, respectively[45] - The company recognizes revenue from natural gas sales based on regulated tariff rates, with revenues recognized in the period natural gas is delivered and consumed[70] - CEV's commercial solar projects recognize revenue as electricity is generated and transferred to customers, with payments due monthly for the previous month's services[72] Capital Expenditures and Investments - Capital expenditures for the three months ended December 31, 2024, totaled $151.9 million, up from $114.6 million in the same period of 2023, reflecting an increase of approximately 32.5%[167] - The company has long-term contracts for natural gas supply, transportation, and storage with annual fixed charges of approximately $187.8M[154] - NJNG's capital expenditures for the three months ended December 31, 2024, are significant, focusing on customer growth and pipeline integrity management[210] Regulatory and Compliance - The BPU approved the SAVEGREEN program with a total investment of $385.6M, expected to increase annual recoveries by approximately $12.3M starting January 1, 2025[89] - A $157.0M increase to base rates was approved, effective November 21, 2024, with an overall rate of return on rate base of 7.08% and return on common equity of 9.60%[89] - NJNG filed a petition to issue up to $700M in Medium Term Notes over three years[89] - NJNG filed a base rate case requesting a natural gas revenue increase of approximately $222.6M, with a proposed overall rate of return on rate base of 7.57% and return on common equity of 10.42%[209] Environmental and Remediation Efforts - NJNG recorded a remediation liability of approximately $161.0 million related to former Manufactured Gas Plant sites, with estimated future expenditures ranging from $130.9 million to $194.6 million[161] - The company is involved in ongoing environmental remediation efforts with estimated future costs that may impact financial performance, pending regulatory determinations[160] Customer and Market Dynamics - NJNG's operations are influenced by seasonal demand, with most revenues generated during the winter months when natural gas is primarily used for heating[205] - NJNG's customer growth is influenced by political and regulatory policies, the delivered cost of natural gas, interest rates, and general economic conditions[215]

Financial Data and Key Metrics Changes - For Q1 2025, the company reported NFEPS of $1.29 per share, an increase from $0.74 per share in the same period last year [21] - The fiscal 2025 NFEPS guidance is set between $3.05 and $3.20 per share, exceeding the long-term growth rate of 7% to 9% [14][29] Business Line Data and Key Metrics Changes - New Jersey Natural Gas achieved a rate base of $3.2 billion after implementing new rates, recovering $850 million in investments [11] - Clean Energy Ventures placed approximately 11 megawatts of commercial solar projects into service and has an additional 63 megawatts under construction [17] - The Storage and Transportation business continues to deliver stable returns through fee-based revenues, with ongoing projects at Leaf River and Adelphia Gateway [19] Market Data and Key Metrics Changes - The company is well-positioned to capitalize on emerging growth opportunities across its diversified portfolio, particularly in energy efficiency and renewable energy [13][29] - The company anticipates cash flow from operations to be between $460 million and $500 million in fiscal 2025, supporting capital plans and dividends [24] Company Strategy and Development Direction - The company is focused on disciplined capital allocation and enhancing utility infrastructure, with planned capital expenditures ranging from $1.3 billion to $1.6 billion for fiscal 2025 and 2026 [23] - The company emphasizes its commitment to sustainability and decarbonization initiatives, including investments in energy efficiency and carbon capture technology [28] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the operating performance across all business segments and the ability to navigate current opportunities [15][30] - The company is monitoring the winter season closely, which is critical for its financial outlook [15] Other Important Information - The SAVEGREEN energy efficiency program, valued at $386 million, is the largest in New Jersey's history and operates separately from the base rate case [11][68] - The company maintains a strong balance sheet and liquidity position, with an adjusted funds from operations to adjusted debt ratio projected between 18% and 20% for fiscal 2025 [24] Q&A Session Summary Question: How is the guidance for 2025 trending? - Management confirmed that they are well within the guidance range of $3.05 to $3.20 per share [38][40] Question: What is driving growth in Clean Energy Ventures? - The company has diversified its portfolio and is focusing on jurisdictions supportive of solar energy, with a robust project pipeline [42][43] Question: Any updates on the Adelphia rate case? - Management expects the rate case to proceed and be settled sometime in 2025, with no significant updates at this time [53] Question: What is the regulatory treatment of the SAVEGREEN program? - The SAVEGREEN spend is not included in the base rate case filings and operates on a near real-time recovery basis [68] Question: Will tariffs impact equipment needs for capital investments? - Management does not expect significant impacts from tariffs on equipment or supplies for utility operations [72][73]