Northwest Natural Gas Q4 Earnings Call Highlights

Core Insights - The company reported record adjusted earnings per share (EPS) of $2.93 for 2025, an increase from $2.33 in 2024, driven by new rates in Oregon, strong organic customer growth, and diversification into the water utility business [2][7][3] - The water segment contributed $0.35 per share, exceeding expectations, due to new rates at its largest Arizona utility and additional revenue from a late 2024 acquisition [1] Financial Performance - Full-year 2025 adjusted EPS was $2.93, reflecting a growth of 25.8% from 2024 [2] - The company initiated 2026 adjusted EPS guidance of $2.95–$3.15, with SiEnergy and Water expected to contribute about 25% of consolidated earnings [18][7] Strategic Initiatives - The company emphasized a "new chapter" marked by record earnings, strong customer growth, and a larger capital investment program across its gas and water businesses [4] - The MX3 gas-storage expansion project at Mist is expected to add 4–5 billion cubic feet (BCF) of storage capacity, with an estimated cost of $300 million and targeted in-service by the end of 2029 [6][10] Regulatory and Funding Plans - A settled Oregon rate case will raise customer rates by 1.5% effective October 31, 2026, as part of a long-term capital expenditure plan of $2.6–$2.9 billion through 2030 [5][8] - The company expects to fund its 2026 capital program through operating cash flow, approximately $150 million in net new debt, and $40–$50 million in equity issuance [19] Customer Growth and Market Expansion - SiEnergy achieved 18% organic customer growth in 2025 and is expected to continue growing at 15%–20% annually through 2030 [15][16] - The water segment is projected to generate 2%–3% organic customer growth through 2030 and contribute 10%–15% of consolidated EPS in 2026 [17] Shareholder Returns - The company marked its 70th consecutive year of dividend growth and expects higher growth in dividends while targeting a long-term payout ratio of 55%–65% [20]