New Jersey Resources (NJR) Q4 Earnings call transcript Nov 26, 2024

In the recent fiscal 2024 fourth quarter and year-end conference call, New Jersey Resources (NJR) shared its achievements and strategies for continued growth, highlighting a strong financial performance and a focus on clean energy investments. The call, led by President and CEO Steve Westhoven, provided insights into the company's strategic initiatives and financial health, offering a positive outlook for the future.

Strong Financial Performance

NJR reported exceeding the high end of its non-financial earnings per share (NFEPS) guidance range for the fiscal year, marking the fourth consecutive year of surpassing initial expectations. The company's strong financial performance is attributed to its diversified business model, strategic investments, and a focus on delivering shareholder value.

Key Strategic Initiatives

The company's strategic initiatives include a successful resolution of its base rate case for New Jersey Natural Gas (NJNG), ensuring safe and reliable service for its customers. This resolution, along with the expansion of NJNG's energy efficiency offerings, positions NJR for success in the future. In the Clean Energy Ventures (CEV) segment, NJR is focusing on commercial solar projects, with over a gigawatt in its project pipeline, the largest in the company's history. This strategic focus on commercial projects is expected to provide high single-digit, unlevered returns, reinforcing NJR's commitment to clean energy and sustainable growth.

Financial Outlook and Capital Expenditures

For fiscal 2025, NJR maintains its long-term NFEPS growth target of 7% to 9%. The company plans to deploy capital to enhance its utility infrastructure, expand its clean energy portfolio, and grow its storage and transportation assets. The capital expenditures for fiscal 2025 and 2026 are expected to range from $1.3 billion to $1.6 billion, aligning with the long-term NFEPS growth target.

Regulatory and Stakeholder Relationships

NJR's relationship with the New Jersey Board of Public Utilities (BPU) has been constructive, with recent approvals for its base rate case and energy efficiency offerings. These approvals provide a solid foundation for the company's future growth and demonstrate the balance of interests between customers and shareholders.

Looking Ahead

With a strong focus on core business expansion, clean energy investments, and maximizing the value of existing assets, NJR is well-positioned for sustained, long-term growth. The company's strategic plan includes a 4% dividend yield and a target total shareholder return of 11% to 13%, demonstrating its commitment to delivering superior returns and maintaining its position as a leader in energy infrastructure.

Conclusion

New Jersey Resources' fiscal 2024 has been a year of accomplishments, with a strong financial performance, strategic initiatives, and a focus on clean energy investments. With a solid foundation in place, the company is well-positioned for continued growth and value creation for its shareholders.