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Northwest Natural pany(NWN) - 2022 Q4 - Earnings Call Transcript
NWNNorthwest Natural pany(NWN)2023-02-24 16:55
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Financial Data and Key Metrics Changes - For 2022, the company reported net income of 86.3millionor86.3 million or 2.54 per share, an increase of 7.6millionoraround107.6 million or around 10% compared to net income of 78.7 million or 2.56persharein2021[8][36]−Forthefourthquarter,netincomewas2.56 per share in 2021 [8][36] - For the fourth quarter, net income was 47.9 million or 1.36persharecomparedto1.36 per share compared to 40.5 million or 1.32pershareforthesameperiodin2021[32]BusinessLineDataandKeyMetricsChanges−Thegasutilitycontributedanadditional1.32 per share for the same period in 2021 [32] Business Line Data and Key Metrics Changes - The gas utility contributed an additional 0.10 of earnings in 2022, primarily due to new rates in Oregon and Washington, customer growth, and amortization of deferrals approved in the Oregon rate case [37] - The water and wastewater utilities grew 3.8% over the last 12 months, with Texas posting 8% organic growth and Idaho's water utility providing 4% growth [14][15] Market Data and Key Metrics Changes - In Oregon, employment grew at a strong annualized rate of 4% in the fourth quarter, while unemployment was 4.5% in December 2022, up from a low of 3.5% in July [11][12] - The housing market has moderated, with home sales, new listings, and average prices all down, impacting gas utility customer growth [12] Company Strategy and Development Direction - The company is focused on decarbonization and believes in leveraging existing systems innovatively rather than solely electrifying gas systems [23][28] - The company is investing in renewable natural gas (RNG) and has contracted to invest approximately 50millionintwofacilitiesbeingdevelopedbyEDL[52][53]Management′sCommentsonOperatingEnvironmentandFutureOutlook−Managementnotedthatinflationisweighingonhouseholds,andtheyareworkingcloselywithcommissionstosupportcustomersthroughratemitigationstrategies[16][19]−Thecompanyinitiatedearningsguidancefor2023intherangeof50 million in two facilities being developed by EDL [52][53] Management's Comments on Operating Environment and Future Outlook - Management noted that inflation is weighing on households, and they are working closely with commissions to support customers through rate mitigation strategies [16][19] - The company initiated earnings guidance for 2023 in the range of 2.55 to 2.75pershare,assumingcontinuedcustomergrowthandaverageweatherconditions[43]OtherImportantInformation−Thecompanyincreaseddividendsforthe67thyearandwasrecognizedasoneoftheworld′smostethicalcompaniesbyEthisphere[7]−Cashprovidedbyoperatingactivitieswas2.75 per share, assuming continued customer growth and average weather conditions [43] Other Important Information - The company increased dividends for the 67th year and was recognized as one of the world's most ethical companies by Ethisphere [7] - Cash provided by operating activities was 148 million, with nearly $340 million invested into the business, primarily for gas utility capital expenditures [40] Q&A Session Summary - No questions were recorded during the Q&A session, and the call concluded without further inquiries [63]