Public Service Enterprise Group Incorporated

Ladies and gentlemen, thank you for standing by. My name is Rob, and I am your event operator today. I'd like to welcome everyone to today's conference, Public Service Enterprise Group's fourth quarter and full year 2025 earnings conference call and webcast. At this time, all participants will be in listen-only mode. Later, we'll conduct a question and answer session for members of the financial community. At that time, if you have a question, you'll need to press the star and the number one on your telephone keypad. To withdraw your question, press star and then number two. If anyone should require operator assistance during the conference, please press star zero from your telephone keypad. As a reminder, today's conference is being recorded today, February 26, 2026, and will be available for replay as an audio webcast on PSEG's Investor Relations website at https://investor.pseg.com. I would now like to turn the call over to Carlotta Chan. Please go ahead.

Good morning, and welcome to PSEG's fourth quarter and full year 2025 earnings presentation. On today's call are Ralph La Rosa, Chair, President, and CEO, and Dan Craig, Executive Vice President and CFO. The press release, attachments, and slides for today's discussion are posted on our IR website at investor.pseg.com. and our 10-K will be filed later today. PSEG's earnings release and other matters discussed during today's call contain forward-looking statements and estimates that are subject to various risks and uncertainties. We will also discuss non-GAAP operating earnings, which differs from net income, as reported in accordance with generally accepted accounting principles, or GAAP, in the United States. We include reconciliations of our non-GAAP financial measures and a disclaimer regarding forward-looking statements on our IR website and in today's material. Following our prepared remarks, we will conduct a 30-minute question and answer session. I will now turn the call over to Ralph LaRosa.

Thank you, Carlotta. And thank you all for joining us to review PSEG's fourth quarter and full year 2025 financial and operating results, our financial outlook for the year ahead, and our long-term projections through 2030. But before I dive in, I'd like to thank our employees once again this past week, prepared and restored our system from yet another intense combination of winter weather that brought over two feet of heavy snow, single digit temperatures and 60 mile per hour winds to our service areas in New Jersey and Long Island. I can't say enough about our crews dedication throughout this entire winter season, working in freezing conditions to keep the lights on and our customers warm. Now, starting with our financial results, PSEG reported net income of 63 cents per share for the fourth quarter and $4.22 per share for the full year of 2025. Our non-GAAP operating earnings were 72 cents per share for the fourth quarter and $4.05 per share for the full year of 2025. Also, earlier today, we announced our dividend declaration for the first quarter of 2026. setting the indicative annual rate at $2.68 per share. This is a $0.16 per share increase, an increase of approximately 6% over last year's dividend, and higher than last year's increase of $0.12 per share, all reinforced by our confidence in our long-term projections. Starting with operations, on February 7, 2026, we hit a seasonal gas send-out peak when temperatures dipped below 10 degrees Fahrenheit. registering the fifth highest send-out in our history. During that same cold snap, PSE&G's appliance service business responded to nearly 2,000 no-heat calls per day, compared to an average of 600 calls on a typical winter day. And our electrical systems also performed well, with a comparatively small group of customers affected, and PSE&G was able to restore service to virtually all customers within 24 hours. Beyond the storm seen in 2026 to date, PSE&G's full year results for 2025 were achieved while facing multiple severe storms and extreme weather events throughout the year that stressed our electric and gas systems. PSE&G's response, guided by our operational excellence model, achieved excellent results in safety, reliability, and customer satisfaction measures. I'm also very proud of the work PSEG is doing in support of New Jersey's efforts to minimize utility bill increases. Last July, we implemented several summer relief initiatives in cooperation with New Jersey regulators to help our customers manage the impact of PJM-related electric supply costs that PSEG passes through to customers. The latest example of our efforts occurred on February 1st, when PSE&G held its residential gas rate flat for the remainder of the winter 2025 through 2026 heating season. Extending the stability of our gas rates further highlights PSE&G's favorable residential gas bill profile, which is not only the lowest cost in the state, but also the lowest in the region. And there's more good news to report on the customer front. Earlier this month, the New Jersey Board of Public Utilities approved the results of the latest electric supply auction, known as the Basic Generation Supply Auction, or BGS, which will result in a 1.8% reduction in the average monthly bill for PSE&G residential electric customers starting June 1, when seasonal electrical use is at its highest. Over the next several months, we will introduce even more ways to help our customers manage and save on their utility bills, with increased budget billing education, new time of use rates, and more energy efficiency solutions. PSE&G also received approval to extend its three-year GSMP3 program, which will continue our efforts to reduce methane emissions of powerful greenhouse gas. We know that our cumulative progress from these programs has reduced our methane emissions by over 30% system-wide from 2018 levels. And recent winter weather has validated how effective our gas system investments have been by reducing both the number of pipe breaks and low pressure issues compared to similar low temperature events in the past. Our operating performance continues to be a positive differentiator in the state and the region. PSE&G received the 2025 Reliability I Awards for outstanding system resiliency, outstanding customer engagement, and for the 24th year in a row, outstanding reliability performance in the Mid-Atlantic region. PSE&G ranked number one in customer satisfaction among large electric utilities in the East region, according to the J.D. Power 2025 U.S. Electric Utility Residential Customer Satisfaction Study. marking the fourth consecutive year PSE&G has earned the top position in this segment. And PSE&G Long Island, yes, PSE&G Long Island ranked number one in customer satisfaction among large electric utilities in the east region according to the J.T. Power 2025 U.S. Electric Utility Business Customer Satisfaction Study. capping an 11-year rise from the bottom of the rankings as PSEG Long Island took over the operation of the electric grid on Long Island. And by the way, PSEG was number two in that same study. Finally, PSEG Long Island was awarded a five-year contract extension to continue as the electric transmission and distribution operator on Long Island and the Rockaways through 2030. We look forward to continuing our constructive partnership with LIPA that has enabled us to become the best performing overhead electric service provider in New York State. And like PSE&G in New Jersey, a top performer nationally for reliability and safety. 2025 was a successful year for our company, both operationally and financially. PSE&G executed on its capital plan, investing approximately $1 billion in the fourth quarter, and approximately $3.7 billion in total for the year in regulated capital spend. On the generating side, PSEG nuclear posted a 91.2% capacity factor for the full year, producing approximately 30.9 terawatt hours of 24 by 7 carbon-free baseload power for the grid, including during the intense June 2025 heat wave for when New Jersey needed it most. PSCG's non-GAAP operating earnings for 2025 were at the high end of our narrowed guidance range of $4 to $4.06 per share, extending management's track record of delivery results that either met or exceeded our earnings guidance for the 21st consecutive year. Turning to our outlook for 2026, first, we initiated a non-GAAP operating earnings guidance in the range of $4.28 to $4.40 per share, an increase at the midpoint of 7% over 2025 results. Our 2026 guidance is based on our investment program at PSE&G and expected nuclear output realizing market prices that exceed the nuclear PTC threshold. We are approximately 95% hedged for the remainder of 2026. We will also keep to our longstanding practice of stringent cost control and continuous improvement to support affordability and benefit our customers. Second, we updated PSEG's capital program to $24 to $28 billion for the 2026 to 2030 period, with over 90% focused on regulated investments. Regulated capital spending is forecasted in the range of $22.5 to $25.5 billion and supports a rate-based CAGR of 6% to 7.5% over the same period. And our solid balance sheet supports execution of this robust five-year capital plan still without the need to issue equity or sell assets. With these updates, we are raising PSEG's long-term non-GAAP earnings growth outlook to 6% to 8% through 2030. This higher growth rate is supported by our best-in-class utility operations executing on a customer-focused infrastructure modernization and energy efficiency investment programs. This regulated growth is supported by nuclear generation ownership. a significant cash flow generator, and therefore a differentiator among our peers. Potential growth beyond our forecasted 6% to 8% CAGR range could be achieved through opportunities to contract existing and additional generating output and through incremental regulated capital investments. The supply-demand dynamic we are seeing in New Jersey has prompted executive orders to be issued to explore supply options. including the development of an additional 3,000 megawatts of community solar and battery storage. We have been cooperatively working with policymakers since last November, and we look to help New Jersey achieve the high-priority goals of these executive orders, which include the exploration of regulatory reform. The executive orders also direct the VPU to provide for residential universal bill credits to again offset electricity supply rate increases. We look forward to constructive dialogue with the BPU on these issues. Turning to the legislative front, in the past few days, a bill was reintroduced in the state legislature to establish a new natural gas power plant procurement program at the BPU, and it incentivizes the development of new natural gas power plants in the state. This gas bill pairs with an earlier bill that established a new nuclear procurement program also within the BPU. of this legislative session. We look forward to working with policymakers to advance energy strategies and resources that secure affordable, reliable, and diverse energy supplies and support legislation that would increase competition for generation supply should New Jersey decide to pursue new in-state generation. And as we have previously mentioned, we are well positioned to help meet that need. We have sites with grid connection capability and pipeline supplies as well as the in-house expertise to build new supply here in New Jersey with prevailing wage labor. I will now turn the call over to Dan, who will walk you through our 2025 financial results and the outlook for 2026, and then rejoin the call for Q&A.