Northwest Natural pany(NWN) - 2025 Q1 - Quarterly Report

Financial Performance - Operating revenues increased to $494,284,000 in Q1 2025 from $433,470,000 in Q1 2024, representing a growth of 14.0%[13] - Net income rose to $87,916,000 in Q1 2025, up from $63,823,000 in Q1 2024, marking an increase of 37.7%[13] - The company reported a basic earnings per share of $2.18 for Q1 2025, up from $1.69 in Q1 2024, an increase of 29.1%[13] - Net income for Q1 2025 was $91,039,000, compared to $67,558,000 in Q1 2024, reflecting a significant increase of 34.8%[20] - Total operating revenues for NW Holdings reached $494.3 million in the first quarter of 2025, compared to $433.5 million in the same quarter of 2024, indicating a growth of 14.0%[64] - Total operating revenues for NW Natural for Q1 2025 were $448,813,000, up from $422,775,000 in Q1 2024, indicating a growth of 6.2%[76] Assets and Liabilities - Total assets reached $5,706,892,000 as of March 31, 2025, compared to $4,849,066,000 a year earlier, reflecting a growth of 17.6%[15] - Total current liabilities decreased to $513,956,000 as of March 31, 2025, from $649,017,000 a year earlier, a reduction of 20.8%[17] - Total shareholder's equity increased to $1,516,205,000 as of March 31, 2025, compared to $1,282,362,000 in the same period last year, a growth of 18.3%[25] - As of March 31, 2025, NW Holdings' long-term debt totaled $2,193.1 million, an increase from $1,574.7 million as of March 31, 2024[120] - NW Holdings' gross long-term debt increased to $2,244,343 thousand as of March 31, 2025, from $1,586,189 thousand as of December 31, 2024[130] Cash Flow and Investments - Cash provided by operating activities was $179,610,000 in Q1 2025, compared to $125,039,000 in Q1 2024, an increase of 43.7%[19] - Cash provided by operating activities rose to $181,230,000 in Q1 2025, compared to $117,983,000 in Q1 2024, marking an increase of 53.4%[26] - The company reported a capital contribution from the parent of $120,000,000 in Q1 2025, which was not present in Q1 2024[25] - NW Holdings raised $1.0 million through the ATM equity program by issuing 22,954 shares in Q1 2025, with $150.6 million remaining available for issuance[74] Capital Expenditures - Capital expenditures for Q1 2025 amounted to $102,184,000, up from $82,217,000 in Q1 2024, indicating a rise of 24.3%[19] - Capital expenditures for NW Holdings totaled $102.2 million in Q1 2025, compared to $82.2 million in Q1 2024, representing a 24.4% increase[64] Acquisitions and Goodwill - The company acquired SiEnergy Operating, LLC on January 7, 2025, expanding its regulated natural gas distribution activities into Texas[28] - Preliminary goodwill of $171.0 million was recognized from the SiEnergy acquisition, reflecting strategic benefits and service territory expansion[148] - Total goodwill from all acquisitions reached $354.5 million as of March 31, 2025, with significant contributions from gas utility and water acquisitions[158] Regulatory and Compliance - NW Holdings and NW Natural's businesses are subject to various regulatory frameworks, which impact their financial reporting and operational strategies, ensuring compliance with state and federal regulations[33] - The allowance for uncollectible accounts is adjusted quarterly based on economic conditions, customer creditworthiness, and natural gas prices, indicating a proactive approach to managing receivables[40] Environmental Liabilities - The estimated total cost for the Portland Harbor Superfund site cleanup is approximately $1.05 billion, with NW Natural's potential liability being a portion of these costs[190] - NW Natural recorded a liability of $52.4 million for the Gasco sediment clean-up, reflecting the low end of the estimated range of $52.4 million to $350 million[194] - The total environmental liabilities recorded in current and non-current liabilities amounted to $35.5 million and $117.3 million as of March 31, 2025, respectively[189] Interest and Debt Management - The weighted average interest rate on NW Holdings' long-term debt was 5.7% as of March 31, 2025, compared to 5.8% a year earlier[120] - NW Holdings borrowed a $50.0 million senior unsecured term loan, due on April 6, 2026, for working capital and general corporate purposes[124] - The interest rate on the Term Loan Agreement is based on term SOFR plus an adjustment of 0.10% or the Alternate Base Rate plus an applicable margin of 0.90%[125][126] Segment Performance - NWN Gas Utility margin for Q1 2025 was $256,822,000, an increase of 17.7% from $218,150,000 in Q1 2024[67] - SiEnergy Gas Utility margin for Q1 2025 was $13,584,000, with total operating revenues of $22,666,000[70] - NW Water operating revenues increased to $13,909,000 in Q1 2025 from $10,695,000 in Q1 2024, marking a growth of 30.6%[72] Legal Matters - NW Natural is involved in ongoing litigation related to climate change impacts, defending against claims brought by Multnomah County[211] - A lawsuit has been filed against NW Natural regarding its Smart Energy program, seeking class certification for enrolled customers over the past six years[212]