RGC Resources Inc.

The host is recording this meeting. Line muted. Press pound pound one or hash hash one to speak. Good morning, and thank you for joining us as we discuss RGC Resources' 2026 second quarter results. I'm Kelsey Davenport, Director of Finance of RGC Resources, Inc., and I'm joined this morning by Paul Nestor, President and CEO of RGC Resources. Tim Mulvaney, our VP Treasurer and Chief Financial Officer, and Tommy Oliver, Senior Vice President of Regulatory and External Affairs. Let's review a few administrative items. We have muted all lines and ask that all participants remain muted. The link to today's presentation is available on the Investor and Financial Information page of our website at www.rgcresources.com. At the conclusion of the presentation and our remarks, we will take questions. Turning to slide one, this presentation contains forecasts and projections. Slide one has information about risks and uncertainties, including forward-looking statements that should be understood in the context of our public filings. Slide two contains our agenda. We will discuss operational and financial highlights for the second quarter and first six months of our 2026 fiscal year. We will then review our outlook for the rest of the 2026 fiscal year with time allotted for questions at the end. I will now turn the presentation over to Tommy.

Well, thank you, Kelsey, and good morning, everyone. Turning now to operations on slide three. Main extensions and renewal activity for the first half of fiscal 2026 were steady. We installed 2.7 main miles, a similar total to the main miles installed in the first half of fiscal 2025. In addition, we connected 340 new services in 2026, which was close to the 359 connections from 2025, evidence that residential development continued across the region in the first half of the fiscal year. As shown on the right side of the slide, we renewed 1.5 miles of main and 196 services during the first half of the 2026 fiscal year. While the main miles renewed were down in part due to weather, compared to the same period last year, the service renewals increased by almost 25%. Let's move to slide four, where we show our delivered gas volumes for the quarter. Despite an extreme cold spell in late January and early February, the quarter as a whole was warmer compared to the same quarter in the fiscal 2025 year. Total volumes were down 5% compared to the second quarter of 2025. Residential and commercial volumes were both down approximately 5% and heating degree days were down 2% compared to the quarter two of fiscal 2025. Let's move to slide five. The story of delivered gas volumes was a little different in the first six months of the fiscal 2026 despite the larger number of heating degree days. Total volumes were down 3% compared to the first half of fiscal 2025 with the decline in industrial usage primarily attributable to one customer being the main reason. Unlike the quarter, heating degree days for the six months increased 3% as the first six months of the fiscal year were colder than the prior year. Let's move to slide six where we'll talk about CapEx. CapEx for the first half of fiscal 2026 compared to 2025. Total spending was $9.8 million in the current year down approximately 8% over the same period a year ago. Winter weather related to winter storm fern in late January and early February affected our spending. We picked back up in March and we'll discuss plans for the remainder of the year later in the presentation. I'm gonna now turn it over to our CFO, Tim Mulvaney, to review our financial results for the quarter. Tim?

Thank you, Tommy. Moving to slide seven, this shows both our second quarter and first half results for fiscal 26. we had a robust quarter with increased grown-up gas margins due to the rates that went into effect january 1st combined with higher earnings from from our unconsolidated affiliate mvp and lower interest expense to overcome higher expenses related to investment in our gas system and inflationary pressures, which remain higher than the Fed's 2% target. Net income of $8.7 million, or $0.84 per diluted share, compared to net income in the same quarter a year ago of $7.4 million, or $0.74 per diluted share, a 14% increase. The year-to-date results are also shown on slide eight. The strong Q2 results drove the six-month performance as well as the first quarter did not have the benefit of the January rates. Net income was 13.6 million in the first half of 2026, or $1.31 per diluted share, compared to $1.26 per diluted share in the first half of fiscal 2025, a 5.3% increase. A reminder about the seasonality of our industry. With recent rate-making activity, much of our revenue is generated through volumetric factors, and accordingly, our performance in the back half of the year when volumes are lower inevitably results in fewer revenues and profits. Paul will discuss our outlook for the remainder of 2026 in a few moments. Moving forward to slide eight, our balance sheet remains strong. We do have a $15 million note at Roanoke Gas that matures in August. that is included in our current maturities of long-term debt. We are deep in conversations with our lenders to refinance this note. We have long known that we would be unable to replicate the 2% rate that we have enjoyed. The discussions with lenders have been positive and should allow us to refinance this note at a rate consistent with our plans. We will have more to share on this in the near term. I will now pass the presentation to Paul Nestor, our CEO.