NewJersey Resources Corporation

Thank you for standing by. My name is Prilla and I will be your conference operator today. At this time, I would like to welcome everyone to the New Jersey Resources fiscal 2025 first quarter conference call. For those of you listening on the live call, all participants will be in a listen only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. Thank you. I would now like to introduce your Speaker for today, Adam Fryer, Director of Investor Relations. You may begin.

Thank you. Welcome to New Jersey Resources Fiscal 2025 First Quarter Conference Call and Webcast. I'm joined here today by Steve Westhoven, our President and CEO, Roberto Bell, our Senior Vice President and Chief Financial Officer, as well as other members of our Senior Management Team. Certain statements in today's call contain estimates and other forward-looking statements within the meaning of the securities laws. We wish to caution listeners of this call that the current expectations, assumptions, and beliefs forming the basis of our forward-looking statements include many factors that are beyond our ability to control or estimate precisely. This could cause results to materially differ from our expectations as found on slide two. These items can also be found in the forward-looking statement section of yesterday's earnings release furnished on Form 8K and in our most recent Forms 10K and 10Q as filed with the FCC. We do not, by including this statement, assume any obligation to review or revise any particular forward-looking statement referenced herein in light of future events. We'll also be referencing the certain non-GAAP financial measures, such as net financial earnings, or NFE. We believe that NFE, net financial loss, utility gross margin, financial margin, adjusted funds from operations, and adjusted debt provide a more complete understanding of our financial performance. However, these non-GAAP measures are not intended to be a substitute for GAAP. Our non-GAAP financial measures are discussed more fully in Item 7 of our 10-K. The slides accompanying today's presentation are available on our website and were furnished on our Form 8-K filed yesterday. Steve will begin with this quarter's highlights beginning on Slide 4, followed by Roberta, who will review our financial results. Then we will open the call for your questions. With that said, I'll turn the call over to our President and CEO, Steve Westhoven.

Please go ahead, Steve. Thanks, Adam, and good morning, everyone. Fiscal 2025 is off to a strong start. During the first quarter, we continue to execute on our strategic initiatives, driving growth across our business segments. At New Jersey Natural Gas, we achieved a significant milestone with the implementation of new rates following the approval of our base rate case. This was supportive of our ability to recover the $850 million of investments made since our last rate case and results in a rate base of $3.2 billion. We launched the next iteration of Save Green, our $386 million energy efficiency program, which is the largest in New Jersey natural gas history and runs through June of 2027. Investments in Save Green are incremental to our rate base and earn a near real-time return to a rider that is updated annually. Green Energy Ventures continues to advance its commercial solar strategy. With a project pipeline of over one gigawatt, we remain well-positioned to drive growth At storage and transportation, we continue to move forward on our capacity recovery project at Leaf River. And at Delphia Gateway, Section 4 rate case is progressing with an expected resolution later this year. And finally, at energy services, we continue to derive significant value from our portfolio of strategically located storage and transportation assets, as well as continued contribution from the asset management agreements announced in 2020. These achievements reinforce our commitment to delivering shareholder value for disciplined capital allocation. As we review our strong first quarter performance, it's clear that NJR is not only delivering on its commitments, but it's strategically positioned to capitalize on emerging growth opportunities. Now let's turn to our guidance for fiscal 2025 on slide five. This reflects the strength of our diversified portfolio and our ability to navigate current opportunities and long-term objectives. Our fiscal 2025 NAPPS guidance $3.05 a share to $3.20 per share, which exceeds our long-term growth rate of 79% and incorporates the one-time gain from our sale of our residential solar portfolio. We are encouraged by the recent operating performance across all of our businesses, and we will carefully monitor and assess our financial outlook as we move forward through the winter season. On slide six, we break out our fiscal year 2025 NFEPS by segments. We slightly narrowed the contribution ranges of our business units in the first quarter and will continue to do so as the year progresses. The majority of our NFVPS is expected to come from our utility operations. Now let's discuss our complementary business units, starting with New Jersey Natural Gas on slide seven. During the quarter, we invested $127 million in New Jersey Natural Gas, with 43% of that capex providing near real-time returns. We are leveraging investments to enhance reliability and drive consistent customer growth through our new construction and conversions, as well as expansion into new locations. Moving to slide 8, at Clean Energy Ventures, we successfully placed approximately 11 megawatts of commercial solar projects into service during the period, with an additional 63 megawatts currently under construction. Looking ahead, we're well positioned to continue growing our capacity by leveraging a robust and steadily expanding project pipeline of over one gigawatt. Furthermore, the sale of our residential solar portfolio enhances our balance sheet and recycles capital to support the future growth opportunities. Moving to slide nine, our storage and transportation business continues to deliver stable returns through fee-based revenues. Our infrastructure investments, including pipelines and storage facilities, are strategically positioned to serve constrained energy markets. The Delta Gateway continues to work through its FERC rate case, which reflects the investments made to enhance and modernize our pipeline system. We anticipate the conclusion to the process later in 2025. We are also actively advancing our capacity recovery project at Leaf River, focusing on restoring and enhancing storage capabilities to meet growing energy demand. Overall, we have made excellent progress throughout the quarter on several fronts. With that,