Northwest Natural pany(US:NWN)2021-02-26 21:35Financial Data and Key Metrics Changes - The company reported net income from continuing operations of $2.30 per share for 2020, an increase from $2.19 per share in 2019, reflecting solid performance in gas utility and contributions from water utilities [6][22]. - For Q4 2020, net income from continuing operations was $45.8 million or $1.50 per share, compared to $38.3 million or $1.26 per share for the same period in 2019 [19]. - Utility margin in the gas distribution segment increased by $11.5 million due to new rates in Oregon and customer growth, partially offset by COVID-19 impacts [21]. Business Line Data and Key Metrics Changes - The gas utility segment saw an increase in utility marketing by $11.3 million due to higher customer rates and growth, alongside revenues from the Northwest expansion project [23]. - The water and wastewater utilities experienced organic customer growth of 2.8% over the 12 months ended December 31, 2020 [33]. Market Data and Key Metrics Changes - Portland's unemployment rate was reported at 6.1% in December 2020, down from a high of 14.9% in April 2020, indicating economic recovery [8]. - Single-family housing activity in the Portland metro region showed home sales up 8.3% from 2019, with price growth of about 12% [8]. Company Strategy and Development Direction - The company aims to diversify its business by investing in the water sector and has made progress by selling non-core investments to reinvest in gas and water businesses [32]. - A key pillar of the company's strategy is pursuing a renewable future and decarbonizing the gas utility system, with plans to integrate renewable natural gas and hydrogen into their operations [35][39]. Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by the pandemic but emphasized the company's resilience and ability to achieve financial and operational goals [6]. - The company expects continued customer growth and has provided 2021 earnings guidance in the range of $2.40 to $2.60 per share, assuming average weather conditions and no significant regulatory changes [29][30]. Other Important Information - The company invested over $270 million in natural gas infrastructure in 2020, part of one of the largest capital programs in its history [8]. - The Board approved a dividend increase in Q4 2020, marking the 65th consecutive year of annual dividend increases [14]. Q&A Session Summary Question: Can you talk about the Texas crisis and its implications for electrification and decarbonization? - Management highlighted the importance of system resiliency and redundancy, noting that natural gas infrastructure is critical during extreme weather events [49][50]. Question: How did the water assets perform in Texas? - The Texas water operations were impacted by power outages and freezing conditions, but service was restored within 24 to 48 hours [63]. Question: What is the status of hydrogen blending testing? - The company is pleased with the initial results of 5% hydrogen blend testing, focusing on leakage detection and performance of end-use equipment [66][68].