Northwest Natural pany(US:NWN)2021-05-05 20:22Financial Data and Key Metrics Changes - The company reported net income of $59.5 million or $1.94 per share for Q1 2021, compared to $48.3 million or $1.58 per share for the same period in 2020, reflecting a solid financial performance [16][8] - Utility margin in the gas distribution segment increased by $13.6 million due to new rates and customer growth, partially offset by a $1.8 million loss from the gas cost incentive sharing mechanism [18][16] - Cash provided by operating activities was $137 million, an increase of $32 million compared to the previous year [21] Business Line Data and Key Metrics Changes - The gas utility's earnings increased by $0.19 per share, while other activities contributed an additional $0.17 per share compared to last year [17] - The company connected over 11,000 meters during the 12 months ended March 31, resulting in a customer growth rate of 1.4% [13] - Water and wastewater utilities experienced a strong growth rate of 3% due to residential housing construction in Idaho, Texas, and Washington [13] Market Data and Key Metrics Changes - Oregon's unemployment rate was reported at 6.1% in February, comparable to the national rate, with strong housing activity in the Portland metro region [12] - Home sales in the Portland metro area increased by 7.4% from 2020, with average price growth of about 12% [12] Company Strategy and Development Direction - The company aims to be a carbon-neutral energy provider by 2050, with a commitment to a 30% carbon savings goal by 2035 [36][31] - The company is actively pursuing renewable natural gas (RNG) opportunities and has made progress with investments under Oregon Senate Bill 98 [48][47] - The company is focused on infrastructure improvements and technology upgrades in its water utilities to enhance service reliability [40] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to adapt to challenges such as the COVID-19 pandemic and recent weather events while maintaining commitments to stakeholders [27] - The company reaffirmed its 2021 earnings guidance for net income in the range of $2.40 to $2.60 per share, assuming continued customer growth and average weather conditions [24] Other Important Information - The company has a strong balance sheet with ample liquidity, allowing for continued investment in capital expenditures [21] - The company has been recognized for its customer satisfaction, ranking second among large utilities in the J.D. Power gas utility residential customer satisfaction study [38] Q&A Session Summary Question: Additional investments under SB 98 and long-term growth - Management indicated ongoing discussions around investment and procurement opportunities for RNG, with expectations for continued activity in this area [48] Question: Washington regulatory front and rate cases - Management confirmed they are in the middle of a rate case and are hopeful for a settlement with all parties involved [50] Question: Non-recoverable COVID costs and inflation pressures - Management noted that the primary impact from COVID was the margin loss due to fewer commercial customers, with some inflation pressures observed in capital costs and salaries [56]