Chesapeake Utilities Corporation

Welcome to Chesapeake Utilities Corporation's third quarter 2024 earnings conference call. At this time, all participants have been placed on a listen-only mode, and the floor will be open for your questions following the presentation. If you would like to ask a question at that time, please press star 1 on your telephone keypad. If at any point your question has been answered, you may remove yourself from the queue by pressing star 2. So others can hear your questions clearly, we ask that you pick up your handset for best sound quality. Lastly, if you should require operator assistance, please press star 0. I would like to turn the call over to Lucia Dempsey, head of investor relations. Please go ahead.

Thank you, and good morning everyone. Today's presentation can be accessed on our website under the investors page and events and presentations subsection. After our prepared remarks, we will open the call up for questions. On slide 2, we show our typical disclaimers, while I remind you that matters discussed on this conference call may include forward-looking statements that involve risks and uncertainties. Forward-looking statements and projections could differ materially from our actual results. The safe harbor for forward-looking statements section of our 2023 annual report on form 10-K provides further information on the factors that could cause such statements to differ from our actual results. Additionally, the company evaluates its performance based on certain non-GAP measures, including adjusted gross margin, adjusted net income, and adjusted earnings per share. And the information presented today includes the appropriate disclosures in accordance with the SEC's regulation G. A reconciliation of these non-GAP measures to the related GAP measures has been provided in the appendix of this presentation in our earnings release and are in our third quarter form 10-Q. Here at Chesapeake Utilities, safety is our first priority. We start all meetings with a safety moment and we'll do so here with a moment on motor vehicle safety, as highlighted on slide 3. The time change and shift into cooler temperatures, though we haven't quite seen that yet, provides us an opportunity to check and update fluid levels, windshield wipers, roadside emergency supplies, and ensure oil changes are on schedule. Also be aware of how the time change affects morning and evening visibility and exercise more caution around wet or slippery roads and increased traffic around holiday travel. I'll now introduce our presenters today. Jeff Householder, Chair of the Board, President, and Chief Executive Officer, will provide an update on demand in our growing service areas, capital investment plan, and business transformation efforts, including an update on the Florida City GAP integration. Beth Cooper, Executive Vice President, Chief Financial Officer, Treasurer, and Assistant Corporate Secretary, will discuss our financial results, strong balance sheets, and dividend and earnings growth trajectory. And Jim Moriarty, Executive Vice President, General Counsel, and Corporate Secretary, and Chief Policy and Risk Officer, will review our regulatory strategy, government affairs efforts, and other company epics. With that, it's my pleasure to turn the call over to Jeff.

Thank you, Lucia. Good morning and thanks to all of you for joining our call today. I'll begin with slide five. Adjusted earnings per share this quarter was 80 cents, bringing our year to date 2024 earnings per share to $3.76. Our results are well aligned with our expectations with strong contributions from both Florida City Gas and our core natural gas operations. Our year to date earnings performance combined with our growth expectations for the remainder of 2024 enable us to reaffirm our full year 2024 adjusted earnings per share guidance of $5.33 to $5.45. Continued expectations of strong demand growth, along with our pipeline of capital projects and regulatory initiatives, drive customer value and enable us to reaffirm our 2025 and 2028 EPS guidance ranges. And, as I'll discuss in more detail shortly, our 2024 capital growth plan remains on track, with $257 million invested in the first nine months of this year and $300 to $360 million expected for full year 2024. Turning to slide six, I'd like to start with a short update on hurricane season. Overall, our systems fared well through hurricanes Debbie, Helene, and Milton, for which we are grateful. While we did have a number of electric customers lose power during Hurricane Helene, we were able to restore power for the majority of our impacted customers within the first 24 hours. I'm pleased with the work our teams have been doing to practice our emergency response procedures and improve the quality and resiliency of our infrastructure and systems, which enabled us to respond quickly and effectively in communicating with customers and restoring their power. Our integration of Florida city gas also continues on track as we make additional progress on standardizing operations, engaging with teammates and exploring investment opportunities to serve with significant growth in our new service areas. Slide seven provides additional detail on this growth, as we are fortunate to operate in some of the fastest growing areas of the country, enabling us to deploy sustainable capital investments to meet the needs of growing customer demand. We have another quarter of outstanding customer growth in both Delmarva and Florida, with each area again experiencing a .9% increase in residential customers in the third quarter of this year relative to the same period last year. We expect strong population growth to continue in our service areas as evidenced by a substantial number of new residential communities planned or in early stage development in both Delmarva and Florida over the next several years. Customers want natural gas service in their homes, so we expect these projects will continue to support strong customer growth. The opportunity to serve increasing customer demand is the basis for our overall growth strategy, which in turn drives sustainable earnings growth. To achieve this growth, we remain consistently focused on three fundamental drivers to support earnings growth as shown on slide eight. First, we work hard to identify and prudently deploy investment capital in projects that align with customer demand and enable us to continue providing safe and reliable energy delivery services. Second, we proactively manage our regulatory agenda to support cost recovery of our capital projects. Third, and equally as important, given our recent and future overall enterprise growth, is business transformation, which prioritizes continuous improvement initiatives that enable us to ensure long-term success in an ever-changing environment. Capital deployment is our primary growth driver, and on slide nine you can see that we've made significant progress toward identifying and initiating at least $1.3 billion of our five-year capital investment plan of $1.5 to $1.8 billion. A particular note, nearly $1 billion of this identified capital requires no additional regulatory approval or support. While we are fundamentally a regulated utility company, we look for opportunities to leverage our related businesses to work together to meet the needs of customers. Although our current slate of identified projects reflects significant regulated investment, we are moving forward on identifying additional regulated and complementary nonregulated investments in 2025 and beyond. Slide 10 shows we are making excellent progress toward our 2024 capital expenditure guidance of $300 to $360 million, with $257 million invested through September of this year, including approximately $100 million spent in the third quarter alone. Our team is focused on efficiently deploying the remaining capital through the balance of the year, including advancing multiple growth projects that were drivers of our FCG acquisition, undertaking capital projects previously approved, and implementing technology that supports our ongoing business transformation. Slide 11 provides additional detail on the major projects that are driving nearly $300 million of capital investment and over $36 million of additional adjusted gross margin in 2024 and 2025 across Delmarva and Florida. All in progress investments remain on track as we focus on managing these construction projects safely and effectively. I'd like to note one new project this quarter, number 18, the Miami Interloop. In September our Peninsula Pipeline Company filed for Florida Public Service Commission approval of the transportation service agreement with Florida City Gas for a series of projects to enhance infrastructure in the Miami area. Referred collectively as the Miami Interloop, this expansion will support growth in FCG's distribution system through new transportation projects and system connection points. Turning to slide 12, our third fundamental growth driver is continual business transformation to support long-term enterprise growth. In August we successfully implemented a new company-wide SAP system which has operated well over the last three months. This is a major step to support the operational transformation we've been working toward for the past few years and we're already seeing a number of benefits and efficiencies with our new billing and field services system. We will also continue to implement additional technology upgrades across the enterprise, including transitioning FCG onto the SAP system next spring and assessing system upgrades to address additional process improvements across the organization. And with that I'll turn to Beth to discuss our financial results in more detail.

Thanks, Jeff, and good morning, everyone. It is great to be here with you today. Our financial results, as shown on slide 13, demonstrate another quarter of strong growth with adjusted gross margin of approximately $122 million, up 29% from the third quarter of last year, driven by the addition of Florida City gas as well as solid performance across all of our businesses. Strong margin growth coupled with operational efficiencies drove significant growth and adjusted earnings per share this quarter, up 48% to approximately $18 million for the quarter and up 30% to approximately $84 million for the first nine months of 2024, compared to the same period in 2023. We also reported strong growth and adjusted earnings per share this quarter, up 11 cents to 80 cents, a 15% increase over the third quarter of 2023. I'll now turn to slide 14 and highlight some of the key drivers of our third quarter 2024 adjusted EPS. Florida City gas operations contributed 75 cents in adjusted EPS, reflecting another quarter of strong customer growth. Our legacy natural gas growth, infrastructure and transmission operations generated 11 cents of incremental EPS this quarter, driven by strong demand for natural gas and additional margin from infrastructure projects completed in 2024. Our Marlin virtual pipeline services delivered an additional 4 cents per share of benefit in the third quarter of 2024 as we expanded offerings for existing and new customers. Increased consumption in our natural gas distribution business added an additional 3 cents per share this quarter. These gains were partially offset by a few factors, including primarily 28 cents of operating expenses related to Florida City gas, 2 cents of increased expenses related to payroll and insurance expenses, and approximately 46 cents related to financing the Florida City gas acquisition. Moving to slide 15, adjusted gross margin for our regulated energy segment was approximately $102 million this quarter, up 35% from the third quarter of last year. Operating income also grew substantially, up 76% to $44 million, excluding non-recurring transaction and transition costs. This improvement was primarily driven by first, strong earnings contribution from Florida City S, secondly, organic growth in our natural gas distribution operations, and finally, incremental margins from our transmission service and expansion and regulated infrastructure programs. As shown on slide 16, our unregulated energy segment also delivered solid improvements relative to the third quarter of last year, with adjusted gross margin up 6% to approximately $20 million for the third quarter of 2024. As just discussed, an increase in our Marlin virtual pipeline services drove the majority of the improvement in our unregulated business this quarter, and we look forward to continuing to grow that business based upon the increasing demand we see in the market. I'll now shift to slide 17 to review our capital structure and financing plan. Maintaining a strong balance sheet, adequate liquidity, and access to competitively priced capital is critical to support our capital investment plan. To this end, we continue to execute on a financing plan consistent with an investment grade credit profile. Our liquidity also remains strong this quarter, with nearly 70% of our revolving credit facility and private placement shell facilities available at the end of September. We ended the third quarter of 2024 with an equity to total capitalization ratio of 49%, up from 47% at the end of 2023, which is on the cusp of our target equity to total capitalization range of 50 to 60%, as we've already issued approximately $64 million in equity through September of this year, primarily via our existing equity programs, including the dividend reinvestment and direct stock purchase plan. Lastly, on November 1, 2024, we issued $100 million of .20% senior notes through October 2029 to further strengthen our balance sheet and support our capital growth plan. Slide 18 shows our strong history of consistent dividend growth of approximately 9%. Our dividend is a key component of our balanced capital allocation strategy, and our current target payout ratio is designed to return value to shareholders while also allowing for earnings reinvestment to fund future growth capital investment. We believe this strategy enables our investors to benefit from long-term, top quartile earnings and dividend growth. Speaking of earnings growth, slide 19 demonstrates our consistent earnings per share performance with our 2028 EPS guidance range reflecting a 10-year EPS growth kegger of approximately 8.5%. Our -to-date 2024 performance is in line with our expectations, enabling us to reaffirm our 2024 adjusted EPS guidance range of 533 to 545 per share, including the acceleration towards our target capital structure. Similarly, we are also reaffirming our 2025 guidance of 615 to 635 per share and our 2028 guidance of 775 to $8 per share. Finally, slide 20 shows our path to our full year 2024 EPS guidance range of 533 to 545. We remain on track with strong contributions from our legacy business and acquisition of Florida City Gas, offset only by the impacts from the acquisition financing. With that, it's my pleasure to turn the call over to Jim.

Thank you, Beth, and good morning, everyone. As Jeff discussed earlier, a proactive regulatory agenda is our second fundamental growth driver, and I would like to share several updates in this area as shown on slide 21. For our Maryland jurisdiction, in September 2024, we received approval for a $2.6 million revenue increase. On November 7th, we filed a phase two proceeding to determine a schedule for incorporating this increase into customer rates. On August 12th, we filed a rate case in our Delaware jurisdiction, proposing a $12.1 million rate increase and an ROE of 11.5%. We also requested interim rate relief of $2.5 million, which was approved with an effective date of October 11, 2024. On August 22nd, we filed a rate case for our Florida electric operations, proposing a $12.6 million rate increase and an .3% ROE. That filing also included a request for $1.8 million in interim rates, which were approved with an effective date of November 1, 2024. We look forward to constructive conversations with our regulators on these filings in order to implement updated rates in the first half of 2025. We also continue to move forward with sustainable investments and recently reached an important milestone at our Full Circle Dairy R&G facility as shown on slide 22. We have completed commissioning at Full Circle Dairy and hosted a ribbon cutting ceremony last week to mark the start of full R&G production operations. Since the start of test production in June, nearly 21,000 deca-firms of R&G have been captured at Full Circle and injected into our system in Hewley, Florida by our Marlin virtual pipeline capabilities. The site reached an additional milestone last week when it received Qualified RIN Status, or Q-RINs, which allows Full Circle Dairy to generate the highly regarded D3 RINs. This qualification also enabled us to generate and monetize RINs for all historical production to date. Overall, our R&G strategy will continue to evolve as the market matures and we will evaluate opportunities that enable us to use our existing transportation services and construction expertise to provide pathways to market for R&G producers. Slide 23 provides an update on our Eastin Shore Worcester Resiliency Upgrade, or WRU project, which is an $80 million liquidified natural gas storage project designed to support growth and resiliency on the Delmarva region. In September, members of our Operations Services team traveled to South Korea to meet with the manufacturer of the five low-profile LNG tanks. Production remains on schedule and the team was pleased with the quality of the production and the efficiency of the organization overall. We anticipate FERC approval by the end of 2024 and remain on track for construction to begin in the first quarter of 2025 for an in-service date in the third quarter of 2025. On the legislative front, we remain focused on maintaining consistent dialogue with governing bodies at the local, state, and federal levels in order to further strengthen and expand our relationships and ensure an understanding of the demands of the communities and customers we serve to deliver affordable, reliable, and domestic energy. We are preparing to work with the new administration and Congress, along with the state and local political leadership, as the next legislative sessions begin in January. We expect a continued focus on energy and tax policy while offering opportunities to educate our elected representatives on the work that we do and advocate for what our customers and communities seek. The efficient delivery of affordable, reliable, and domestic natural gas so that no one is left behind. Turning now to slide 25, I would like to cover our sustainability initiatives and recent community engagements. In September, we published our second micro sustainability report, which focuses on our environmental stewardship efforts. In addition to providing additional information on our environmental commitments to our communities, we reported a 25% reduction in scope one and scope two greenhouse gas emissions since 2019. And a 10% reduction in emissions from 2022 to 2023. Our third micro report, which will focus on community impact, DEI initiatives, and our investments in people, communities, and customers will be released in early 2025. In the aftermath of Hurricane Talene and Milton, the company donated $50,000 across three organizations to support recovery efforts in heavily affected areas. We consider it vital to stand with our fellow utility companies and communities impacted by the hurricanes to provide essential services to those in need. Delivering excellence for all stakeholders is the foundation for long-term growth and success, enabling us to continue serving our customers and driving value for our shareholders for years to come. With that, I will turn the call to Jeff for concluding remarks. Thanks,

Jim. This year has been a critical turning point as we demonstrate our ability to integrate the meaningful acquisition of FCG, deliver on our 2024 EPS and capital guidance ranges, and position the organization to achieve the significant growth embedded in our 2025 EPS guidance through capital investments and regulatory initiatives. We have continued to execute on our plan this past quarter, including delivering financial results that remain in line with our full year expectations and represent top quartile earnings performance. While the weather has provided a less favorable backdrop as we begin the fourth quarter, we will remain focused on our three key growth pillars throughout the remainder of 2024 and look forward to updating you on our full year accomplishments and forward-looking goals for 2025 and beyond. With that, we'll take your questions. Operator?

Thank you. The floor is now open for questions. At this time, if you have a question or comment, please press star one on your telephone keypad. If at any point your question is answered, you may remove yourself from the queue by pressing star two. Again, we ask that you pick up your handset when posing your question to provide optimal sound quality. Thank you. And our first question is coming from Tate Sullivan with Maxim Group. Please go ahead.

Thank you. And sorry if I missed it. But thank you. But you covered the short-term impact to your service territories from the hurricanes. But does this help increase the amount of spending you can do in the future on ongoing storm hardening infrastructure work, or is there something in future rate cases that will help you increase the rate base related to that?

Thank you, Tate, and good morning. First off, I would say we were very fortunate in that the service areas that we're primarily serving in the state, there was minimal impact to our operations. And so as we talked about on the call, Jeff mentioned, we had customers that were out of service for a little less than 24 hours. So in terms of CAPEX and what we're doing in terms of our storm protection and improvement plan, those plans continue. Nothing has really changed or accelerated because of the hurricanes. What we did see and will continue to see is that our system is becoming more and more reliable and resilient. And that was certainly the case with these three.

Thank you. Jeff, can you comment on the Florida City gas? I mean, the customer count, average customers increased quarter over quarter. Should we just look at it? The customer growth opportunity set with Florida City gas is very similar to the growth of Florida natural gas distribution in general. There are different pockets of higher growth.

I think that's I think in general, they are very similar. We're certainly seeing significant activity on city gas system in the Port St. Lucie area. I mean, that continues to be an area of substantial growth. The population in South Florida kind of continues to migrate a little farther north, although we're happy with what we see and certainly in the Boulevard County areas and in Miami as well. But St. Lucie is probably the big driver of growth from a residential customer perspective. Now, if you look at the commercial industrial, things move around a little bit. We're seeing significant opportunities in the Miami area relative to those customer classes. And again, on FPU's territory in Florida, lots of development in our central Florida areas. So we're still seeing the wildlife development up in Nassau County, almost into Georgia, growing by leaps and bounds. So we're pretty happy with what we see. I think we've been reporting about a 3.9 percent growth rate in residential customers, and we practically see that continuing into the future.

Thank you.

Thank you. Thank you. And we'll take our next question from Paul Fremont with Leidenberg. Please go ahead.

Hey, congratulations. My first question has to do with are you taking any regulatory action in advance of a possible Supreme Court decision that's coming up in Florida in the first quarter of 25 on RSAM?

Well, there is currently, there's a hearing scheduled as it relates to the RSAM proceeding, and we will certainly be participating in that. And what I would say, Paul, as we've discussed and we've talked about in the past, certainly there is that second tranche of RSAM, and that will, if we're able to pursue that, will certainly rest with what happens with this proceeding. But keep in mind, you know, we at Legacy Chesapeake historically have approached the whole depreciation realm, thinking about it from a depreciation study perspective. So that same opportunity or bucket of dollars is out there, whether it's looked at under an RSAM mechanism or whether we would like to pursue it more as a traditional type of depreciation study. So we're following that, you know, that proceeding very closely. But again, we see opportunities given how we've historically pursued depreciation studies. I was going to ask Jim to also comment. Good morning,

Paul. Hope all is well. We are looking forward to the oral argument on December 10th of the Florida Supreme Court, and we'll be helping others defend the decision of the Florida Public Service Commission. As you can imagine, we do a lot of thinking about what that means and what it could mean. So as Beth stated, we're fully engaged on the issue and we're looking for a positive outcome. But if not, you know, we'll make sure to bring it back in under our depreciation approach.

So, I mean, I take it by your answer, you're going to wait until the Supreme Court issues its final decision before initiating any regulatory action. Is that fair?

We are evaluating whether or not, you know, we will await that. We haven't made any final decisions. Certainly, you know, we will announce if we decide to go down that path, but we're still looking at it, Paul. We've been following it very closely.

Great. Also, I guess how does the Republican control on a federal level impact potential investment opportunities that you might have in either your pipeline business or adding to your LNG regasification?

I think it's a very good question, Paul, and one that we're evaluating as well. You know, we have always had a very favorable, constructive relationship with our federal regulators at FERC and elsewhere. And anytime we've had a project on the front end, we work closely with all the stakeholders so that there were few, if any, protests to what we would propose. And we'll continue that approach. I think what you'll find is a lot of doors opening maybe a little quicker than they did in the past, but we're very excited about our Worcestershire Resiliency Project, you know, on the eastern shore. So I think we're going to see a lot of wind at our backs in the energy industry generally as we go forward and try and make sure that this country continues to benefit from all the resources we have here domestically.

And then last question for me, in terms of the Phase 2 Maryland proceeding, will that also deal with the unification of the three franchises?

That's the plan. Paul, we made the filing yesterday on Phase 2, and, you know, now the other parties will weigh in and then we'll all see before the ALJ.

Great. Thank you so much.

Thank you, Paul.

Thank you. Thank you. And once again, if you do have a question, you may press star 1 on your telephone keypad at this time. And we will take our next question from Chris Ellinghouse with Seabert Williams-Shank. Please go ahead.

Hey, good morning, everybody. Good morning. Jeff, is there anything that through the FCG integration at this point that you've learned either about operations or about incremental investment opportunities that were not what you were expecting?

I think the level of potential opportunity has probably increased a little bit from what we were expecting before we got a good look at the unit. Nothing, you know, outrageously higher than what we had been reporting. But there is certainly growth there that we're pretty happy with. We're also seeing some operational synergies that we're beginning to harvest, frankly. They also at City Gas had a number of things like a 24-7, you know, emergency call response center that we've been able to leverage in our other operations areas. And so there are a variety of things like that that we're seeing that I think promote the sort of synergies that we were hoping to find along with the growth opportunities that are a little bit more robust probably than we had originally anticipated. So it's, you know, so far we haven't had any particular shocks to the system from acquiring that unit. It's been more favorable, generally speaking, I would say, Beth, I don't know if you have anything to add to that.

No, I would agree. I think, you know, you've already seen those three RNG projects. You've seen, you know, the safe investment program increase by $50 million. We've gone in for that. We've made some other filings that actually take the best of what both entities are doing. So overall, I don't think I think Chris, where you were going, is there anything that maybe more negatively we've seen? I would say no, the opposite is true.

You know, the Miami Loop project, the Interloop project that we're talking about on this call is a good example of that. That's a, you know, $70 million project. We had assumed that we would be able to do things like that. But I think now, Beth, we're probably at project, the Miami Interloop, I think, is project number 12 that we filed with the PSC in Florida for small-scale transmission expansions. A lot of that surrounding certainly the Miami area. And so I think we'll see additional projects like that as we begin to try to provide for a more robust delivery of gas capacity into South Florida.

Okay, great. Yeah, I wanted to ask you about the Interloop project. What's the timeline for that?

We filed that, oh, that's a handful of weeks ago, I guess, fairly recently. I don't have the exact date off the top of my head. I would expect the Commission to look at that over the next two or three months. And we will begin construction, hopefully, sometime in Q1 of next year. It's a fairly significant set of projects, as we've described. And so we'll put that into service at least partially next year. And it will begin to do exactly what we are trying to do, which is to improve the deliverability of gas service into places in South Florida, especially Miami, where we're seeing growth and opportunity, especially in some of the, you know, we're seeing a lot of on-shoring and reshoring of manufacturing these days across the industry. And we're seeing that in things like cement production in South Florida coming back into the country. And so we have opportunities to increase deliverability into South Florida and take advantage of those industrial increases. So that's what we're trying to do.

Okay, great. On slide 20, you've been showing us this one bucket of additional opportunities for the year. Can you provide any color on, you know, where you stand in that bucket and, you know, what, you know, sort of what you've been reaping so far?

So that, you know, that, Chris, includes opportunities that we have, you know, in both, you know, on Delmarva and in Florida as we look across the enterprise. So, again, you know, there are things that we're doing, for example, from a control room perspective. There are things that we're doing as it relates to, you know, some of the infrastructure programs and the management and some of those, you know, savings and costs that are happening there. You're seeing a lot already if you look at our expenses for the quarter and look at it on a -to-date basis. There's really three things that are happening. Number one, it's those synergies, some of which I just mentioned. Number two, you're seeing our business transformation efforts continue. In the third quarter, we went live with our Project 1CX and our utility billing system in our legacy operations, and that has created not only efficiencies in how we do things, but also, you know, there's increased, some increased capitalization of costs as we're implementing that technology. So, you know, and then as you kind of move down that list and look at some of those other things, you know, we're very active on the regulatory front in various jurisdictions. We've been successful in Maryland. I know the timing there is a little pushback, but we've been successful. And so it's all of those things coupled with even the most recent debt placement and where we were able to place that debt. So there's a lot of things as we lay out year-end you're going to see, you know, there's just many things that are going on across this enterprise that are working to positively help us stay within, you know, that guidance range.

Okay, that helps. One more thing, can you give us any color on what was involved in the Marlin improvement in the quarter?

So there's been really, you know, there's been a real focus there and a shout-out to the management within our Marlin team who's had a focus really over the last year. We've talked about it in terms of the types of contracts and projects that we're entering into. So, you know, we're focused on number one, let's ensure that we're locking in contracts that look like longer-term contracts and are not more emergency, one-time, -can't-recur type contracts. So that's been the first thing. The second thing that's been happening, and you're hearing us talk about our role in RNG transportation, you know, we're having, you know, more and more projects that we're taking on and services that we're providing kind of like on holdings. And Jeff, I don't know if there's anything else you'd want to add there.

Maybe just one comment. We've spent a fair amount of time over the last handful of years building the asset base in Marlin so that we actually could look at that whole unit from a more commercial point of view. And we have done that, and we've moved the guy, Justin Stankiewicz, into that role that has a commercial view of the marketplace. He also has been running our renewable gas operations for a while. And so that marriage between, you know, getting the tanks and the trucks and everything, the compressors and all the other equipment and assets we needed together at Marlin to actually take it out and begin to market it has now come to pass. And we've got people there that are interested in going out and looking for business that we now have the opportunity to actually satisfy the orders that come in. And so we're seeing a lot of that occurring and we'll continue going forward to balance that commercialization of the business with the asset needs of the business and try to keep the kind of progress and success that you're seeing going. Okay. Thanks. Appreciate

the details, everybody.

Thank you,

Chris.

Thank you. And it appears that there are no further questions at this time. I will now turn the program over to Jeff Householder for closing remarks.

Well, thank you very much for joining us. We always appreciate the interest in Chesapeake Utilities. I hope you have a great Thanksgiving and we'll talk to you soon.

Thank you. This concludes Chesapeake Utilities Corporation's third quarter 2024 earnings conference call. Please disconnect your line at this time and have a wonderful day.