Essential Utilities, Inc.

Hello, everyone. Thank you for joining us, and welcome to Essential's second quarter 2026 earnings call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. I will now hand the conference over to Brian Dingerdissen, Vice President, Investor Relations, and Treasurer. Brian, please go ahead.

Good morning, everyone, and thank you for joining us for our second quarter 2026 earnings call. If you did not receive a copy of the press release, it can be found on our Investor Relations website. The slides can also be found on our website along with a webcast of the event. As a reminder, some of the matters discussed today may include forward-looking statements that involve risk, uncertainties, and other factors that may cause the actual results to be materially different from any future results expressed or implied by such forward-looking statements. Please refer to our most recent 10-Q, 10-K, and other SEC filings for a description of such risk and uncertainties. References may be made to certain non-GAAP financial measures. Reconciliation of any non-GAAP to GAAP financial measures is posted on our website in the investor relations section. We will begin with Chris Franklin, our chairman and CEO, who will provide an update on the company. Then Dan Schuller, our chief financial officer, will provide an overview of the financial results. With that, I will turn it over to Chris Franklin.

Hey, thanks, Brian, and good morning, everyone. Let's begin on slide five, and we'll talk about some corporate updates. First, on the merger. As you've probably seen from our press releases, we've now received three regulatory approvals for the merger from Kentucky, Ohio, and Virginia. In other states, the merger cases have been proceeding as planned, including in Texas, where we've reached a settlement in principle. In New Jersey, public input hearings are scheduled for August. In North Carolina, the process, which does not have a statutory timeline, continues to proceed as planned and testimony was filed at the end of last week. The merger case in Illinois is now with the ALJ and that process does have a statutory timeline and it finishes by November of this year. Finally, in Pennsylvania, negotiations continue with the parties even though we are in the evidentiary hearings this week. We continue to expect the merger to be finalized during the first quarter of 2027. Now, significant planning work is ongoing as we consider the many factors involved in integrating the two companies. We are intent on hitting the ground running as a world-class organization the day after we close this transaction. All right, now for the quarter, we reported gap earnings per share of 37 cents, which includes about a penny of merger-related costs, and puts us at non-GAAP earnings per share of $0.38. When we look at 2026 overall, we're confident that we'll meet our 5% to 7% earnings growth guidance anchored to the non-GAAP 2024 earnings per share of $1.97. And Dan will go into the details in much more detail in a moment. This has been a very busy construction year. We continue to invest capital in the improvement of our regulated water and natural gas systems, which, of course, results in enhanced service to our customers. Year to date, we've invested $662 million, and we're on track to invest a record $1.7 billion in needed infrastructure improvements and upgrades. Turning now to the regulatory environment, let's start in Pennsylvania. As you're aware, on April 29, Governor Shapiro issued a letter to utilities operating within the Commonwealth. The letter instructed companies to prioritize the most cost-effective forms of capital and to explicitly demonstrate the necessity of proposed investments when seeking rate adjustments. Following his communication, the special counsel for the Governor's Office on Energy Affordability called into one of our public input hearings for the pending people's rate case. The special counsel is not an intervener in the people's rate case and acknowledged that our rate case was filed prior to the issuance of the governor's letter. Now, our company has always been a national leader in appropriately replacing aging underground infrastructure, and we are fully committed to sustaining strong levels of capital investment. These investments are critical to ensuring compliance with evolving federal and state regulations, enhancing system reliability and upgrading safety for both our workforce and the communities we serve. And as always, we carefully balance these critical infrastructure needs with consumer affordability to ensure the delivery of safe, resilient and reliable service. We continue to engage constructively with the Pennsylvania Public Utility Commission, the Governor's Office, and the other stakeholders regarding both our current gas rate case and our upcoming Pennsylvania water rate case, which we anticipate filing around the end of the year. As usual, we remain dedicated to absolute transparency in our rate filings and will continue to operate strictly within Pennsylvania's established statutory framework. Finally, reinforcing our long-standing commitment to shareholder value, we're proud to continue our 80-year track record of consecutive quarterly cash dividends. Last week, the Essential Board of Directors approved a 5.25% increase in our quarterly cash dividend, consistent with last year's increase, and this dividend is payable on September 1st, 2026 to shareholders of record on August 11th, 2026. Now if you turn to slide six, this is a snapshot of the regulatory approvals process across our states. The slide provides dockets and next steps so you can follow the approval process. Now a quick note on the integration work that is underway with the merger. It's really been gratifying to watch the teams at Essential and American work together to shape the consolidated company. I knew that our similar mission-based employees would work diligently to make certain the combination went well, but I gotta tell you, the collaboration and cooperation among the teams has exceeded my expectations, and I am more confident than ever that this combination will be a top-performing utility and a must-own investment in the market. And with that, Dan, let me turn it to you for a deeper dive into the quarter.