• National Fuel Reports First Quarter Earnings

    来源: Nasdaq GlobeNewswire / 02 2月 2023 16:45:42   America/New_York

    WILLIAMSVILLE, N.Y., Feb. 02, 2023 (GLOBE NEWSWIRE) -- National Fuel Gas Company (“National Fuel” or the “Company”) (NYSE:NFG) today announced consolidated results for the first quarter of its 2023 fiscal year.

    FISCAL 2023 FIRST QUARTER SUMMARY

    • GAAP net income of $169.7 million, or $1.84 per share, compared to GAAP net income of $132.4 million, or $1.44 per share, in the prior year, an increase of 28% per share.
    • Adjusted operating results of $169.5 million, or $1.84 per share, an increase of 24%, compared to $1.48 per share, in the prior year (see non-GAAP reconciliation on page 2).
    • Adjusted EBITDA of $351.0 million, an increase of 18%, compared to $298.2 million in the prior year (see non-GAAP reconciliation on page 21).
    • Net cash provided by operating activities of $327.3 million, an increase of 91%, compared to $171.5 million in the prior year.
    • Pipeline & Storage segment Adjusted EBITDA of $64.5 million, an increase of 13%, compared to $57.2 million in the prior year.
    • E&P segment Adjusted EBITDA of $190.3 million, an increase of 29%, compared to $147.0 million in the prior year.
    • E&P segment net Appalachian natural gas production of 90.6 Bcfe, an increase of 9.2 Bcfe, or 11%, higher than prior year and 3% higher than fiscal 2022 fourth quarter.
    • Average realized natural gas prices of $3.02 per Mcf, up $0.50 per Mcf from the prior year.
    • Company is revising its fiscal 2023 earnings guidance to a range of $5.35 to $5.75 per share.

    MANAGEMENT COMMENTS

    David P. Bauer, President and Chief Executive Officer of National Fuel Gas Company, stated: “First, I want to share my appreciation for the exceptional performance of our employees during Winter Storm Elliott in Buffalo, NY. In the face of extreme weather conditions, they went the extra mile to ensure that safe, reliable natural gas service continued uninterrupted when it was needed most.

    “Despite this weather challenge, National Fuel had a terrific start to fiscal 2023, with all four segments contributing to a 24% increase in adjusted operating results. Our upstream business led the way, with 11% growth in Appalachian natural gas production and the tailwind of strong natural gas pricing, driving a large portion of the increase over last year.

    “While our outlook for the remainder of fiscal 2023 has been impacted by the recent reduction in natural gas prices, the strength of our integrated model, underpinned by our rate-regulated businesses, provides a measure of earnings and cash flow stability. Longer-term, we are very well positioned to generate significant free cash flow, which we expect will further strengthen our investment grade balance sheet and provide flexibility to deliver additional value to our shareholders in the years ahead.”

    RECONCILIATION OF GAAP EARNINGS TO ADJUSTED OPERATING RESULTS

      Three Months Ended
      December 31,
    (in thousands except per share amounts) 2022
    		 2021
    Reported GAAP Earnings $169,689  $132,392 
    Items impacting comparability:    
    Unrealized (gain) loss on other investments (Corporate / All Other)  (209)  4,490 
    Tax impact of unrealized (gain) loss on other investments  44   (943)
    Adjusted Operating Results $169,524  $135,939 
         
    Reported GAAP Earnings Per Share $1.84  $1.44 
    Items impacting comparability:    
    Unrealized (gain) loss on other investments, net of tax (Corporate / All Other)  —   0.04 
    Adjusted Operating Results Per Share $1.84  $1.48 
             

    FISCAL 2023 GUIDANCE UPDATE

    National Fuel is revising its fiscal 2023 earnings guidance to reflect the results of the first quarter, along with updated forecast assumptions and projections. The Company is now projecting that earnings will be within the range of $5.35 to $5.75 per share, a decrease of $1.10 per share from the midpoint of the Company’s prior guidance range. The decrease from the Company’s prior earnings guidance primarily reflects the impact of lower natural gas price expectations, as the rest of the Company's assumptions and projections are largely unchanged.

    The Company is now assuming that NYMEX natural gas prices will average $3.25 per MMBtu for the remainder of fiscal 2023, a decrease of $1.92 per MMBtu from the $5.17 per MMBtu average ($6.00 per MMBtu in January through March and $4.75 per MMBtu in April through September) assumed in the previous guidance over the remaining nine months of the fiscal year. For guidance purposes, the Company’s updated natural gas price projections approximate the current NYMEX forward curve and consider the impact of local sales point differentials and new physical firm sales, transportation, and financial hedge contracts.

    The Exploration and Production segment’s fiscal 2023 net production guidance range of 370 to 390 Bcfe remains unchanged. Seneca currently has firm sales contracts in place for approximately 90% of its projected remaining fiscal 2023 production, limiting its exposure to in-basin markets. Approximately 68% of Seneca’s expected remaining production is either matched by a financial hedge, including a combination of swaps and no-cost collars, or was entered into at a fixed price.

    The Company’s consolidated and individual segment capital expenditures and other guidance assumptions remain largely unchanged from the previous guidance. The details are outlined in the table on page 7.

    DISCUSSION OF FIRST QUARTER RESULTS BY SEGMENT

    The following earnings discussion of each operating segment for the quarter ended December 31, 2022 is summarized in a tabular form on pages 8 and 9 of this report. It may be helpful to refer to those tables while reviewing this discussion.

    Note that management defines Adjusted Operating Results as reported GAAP earnings adjusted for items impacting comparability, and Adjusted EBITDA as reported GAAP earnings before the following items: interest expense, income taxes, depreciation, depletion and amortization, other income and deductions, impairments, and other items reflected in operating income that impact comparability.

    Upstream Business

    Exploration and Production Segment

    The Exploration and Production segment operations are carried out by Seneca Resources Company, LLC (“Seneca”). Seneca explores for, develops and produces primarily natural gas reserves in Pennsylvania.

     Three Months Ended
     December 31,
    (in thousands)2022 2021 Variance
    GAAP Earnings$91,192  $62,369  $28,823 
            
    Adjusted EBITDA$190,330  $146,999  $43,331 
                

    Seneca’s first quarter GAAP earnings increased $28.8 million versus the prior year primarily due to higher realized natural gas prices and natural gas production. These increases were partially offset by the loss of earnings from Seneca’s California assets that were sold in June 2022, higher Appalachian operating expenses and higher income tax expense.

    Seneca produced 90.6 Bcfe during the first quarter, an increase of 5.5 Bcfe, or 7%, from the prior year. This is a result of a 9.2 Bcf increase, or 11%, in Appalachian natural gas production from Seneca’s development program, offset by a 3.7 Bcfe decrease in production related to the aforementioned California sale.

    Seneca’s average realized natural gas price, after the impact of hedging and transportation costs, was $3.02 per Mcf, an increase of $0.50 per Mcf from the prior year. This increase was primarily due to higher NYMEX prices, higher spot prices at local sales points in Pennsylvania, and an increase in the weighted average hedge price compared to the prior year first quarter.

    On an absolute basis, lease operating and transportation expense (“LOE”) decreased $7.6 million primarily due to the California sale. Partly offsetting that decrease were increases in LOE from higher transportation and gathering costs as a result of increased production, as well as higher repair, rental and personnel costs in Appalachia. LOE expense includes $53.8 million in intercompany expense for gathering and compression services used to connect Seneca’s production to sales points along interstate pipelines. On a per unit basis, LOE was $0.68 per Mcfe, a decrease of $0.13 per Mcfe from the prior year.

    General and administrative (“G&A”) expense decreased by $2.2 million largely due to the California sale. On a per unit basis, G&A expense was $0.17 per Mcfe, a decrease of $0.04 per Mcfe from the prior year.

    The decrease in Seneca’s other operating expenses of $2.1 million was also primarily due to the impact of the sale of Seneca’s California assets.

    Depreciation, depletion and amortization (“DD&A”) expense increased $6.1 million due to higher natural gas production and a higher per unit DD&A rate, which was driven by an increase in capitalized costs in Seneca’s full cost pool. DD&A expense was $0.61 per Mcfe, an increase of $0.03 per Mcfe from the prior year.

    The increase in Seneca’s income tax expense was primarily driven by a prior year first quarter benefit realized from the Enhanced Oil Recovery tax credit, which did not recur in the current year as a result of the sale of the California assets.

    Midstream Businesses

    Pipeline and Storage Segment

    The Pipeline and Storage segment’s operations are carried out by National Fuel Gas Supply Corporation (“Supply Corporation”) and Empire Pipeline, Inc. (“Empire”). The Pipeline and Storage segment provides natural gas transportation and storage services to affiliated and non-affiliated companies through an integrated system of pipelines and underground natural gas storage fields in western New York and Pennsylvania.

     Three Months Ended
     December 31,
    (in thousands)2022 2021 Variance
    GAAP Earnings$29,476  $25,168  $4,308 
            
    Adjusted EBITDA$64,528  $57,150  $7,378 
                

    The Pipeline and Storage segment’s first quarter GAAP earnings increased $4.3 million versus the prior year primarily due to an increase in operating revenues, partially offset by higher operation and maintenance (“O&M”) expense and higher DD&A expense. The increase in operating revenues of $9.3 million was primarily attributable to higher transportation revenues from Supply Corporation’s FM100 Project, which was placed in service in December 2021. O&M expense increased $1.8 million primarily due to an increase in personnel and pipeline integrity costs. The increase in DD&A expense of $1.6 million was primarily attributable to incremental depreciation expense from the FM100 Project.

    Gathering Segment

    The Gathering segment’s operations are carried out by National Fuel Gas Midstream Company, LLC’s limited liability companies. The Gathering segment constructs, owns and operates natural gas gathering pipelines and compression facilities in the Appalachian region, which primarily delivers Seneca’s and other non-affiliated Appalachian production to the interstate pipeline system.

     Three Months Ended
     December 31,
    (in thousands)2022 2021 Variance
    GAAP Earnings$24,738  $23,137  $1,601 
            
    Adjusted EBITDA$46,715  $44,032  $2,683 
                

    The Gathering segment’s first quarter GAAP earnings increased $1.6 million versus the prior year primarily due to higher operating revenues, partially offset by higher O&M expense. Operating revenues increased $4.2 million, or 8%, which was the result of a 6.9 Bcf increase in gathered volumes due to an increase in Seneca’s natural gas production. The increase in O&M expense of $1.5 million was due to higher compression leasing expenses, as well as increases in personnel and preventative maintenance expenses.

    Downstream Business

    Utility Segment

    The Utility segment operations are carried out by National Fuel Gas Distribution Corporation (“Distribution”), which sells or transports natural gas to customers located in western New York and northwestern Pennsylvania.

     Three Months Ended
     December 31,
    (in thousands)2022 2021 Variance
    GAAP Earnings$23,817  $22,130  $1,687 
            
    Adjusted EBITDA$51,577  $52,028  $(451)
                

    The Utility segment’s first quarter GAAP earnings increased $1.7 million versus the prior year primarily due to higher customer margin (operating revenues less purchased gas sold) and a decrease in non-service pension and post-retirement benefit (“OPEB”) costs, partially offset by higher O&M and interest expense. The increase in customer margin was mainly due to increased customer usage, largely attributable to weather that was 27% colder on average than last year in Distribution’s Pennsylvania service territory (where the Company does not have a Weather Normalization Clause), combined with higher revenues from the Company’s system modernization tracking mechanism in its New York service territory. These factors were partially offset by a reduction in base rates in New York as a result of a rate proceeding that became effective October 1, 2022 which temporarily reduced the Utility’s recovery of pension and OPEB expenses to zero. In addition to lowering rates, the proceeding mandated a corresponding decrease in pension and OPEB expense, most of which had been previously recorded in “below the line” non-service pension and post-retirement benefit costs. O&M expense increased by $3.8 million largely due to higher personnel costs. An increase in the accrual for uncollectible accounts, which was generally in line with the increase in the Utility segment’s revenue, also contributed to higher O&M expense for the quarter. Interest expense increased $2.5 million due primarily to a higher weighted average interest rate on intercompany short-term borrowings.

    Corporate and All Other

    The Company’s operations that are included in Corporate and All Other generated combined earnings of $0.5 million in the current year first quarter, which was a $0.9 million increase over the combined net loss of $0.4 million in the prior-year first quarter. The increase in earnings was primarily driven by unrealized gains on investment securities recognized in the current quarter compared to unrealized losses on investment securities recognized in the prior-year first quarter, partially offset by a lower amount of realized gains on investment securities sold in the current quarter as compared to the prior-year first quarter.

    EARNINGS TELECONFERENCE

    The Company will host a conference call on Friday, February 3, 2023, at 11 a.m. Eastern Time to discuss this announcement. To pre-register for this call (recommended), please visit https://www.netroadshow.com/events/login?show=3963c6bd&confld=46096. After registering, you will receive your access details via email. To join by telephone on the day of the call, dial U.S. toll free 1-844–200–6205 and provide Access Code 276256. The teleconference will be simultaneously webcast online and can be accessed on the NFG Investor Relations website at investor.nationalfuelgas.com. An audio replay of the teleconference call will be available until Friday, February 10, 2023. To access the telephone replay, dial U.S. toll free 1-866-813-9403 and provide Access Code 856816.

    National Fuel is an integrated energy company reporting financial results for four operating segments: Exploration and Production, Pipeline and Storage, Gathering, and Utility. Additional information about National Fuel is available at www.nationalfuel.com.

     

    Certain statements contained herein, including statements identified by the use of the words “anticipates,” “estimates,” “expects,” “forecasts,” “intends,” “plans,” “predicts,” “projects,” “believes,” “seeks,” “will,” “may” and similar expressions, and statements which are other than statements of historical facts, are “forward-looking statements” as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties, which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. The Company’s expectations, beliefs and projections contained herein are expressed in good faith and are believed to have a reasonable basis, but there can be no assurance that such expectations, beliefs or projections will result or be achieved or accomplished. In addition to other factors, the following are important factors that could cause actual results to differ materially from those discussed in the forward-looking statements: changes in laws, regulations or judicial interpretations to which the Company is subject, including those involving derivatives, taxes, safety, employment, climate change, other environmental matters, real property, and exploration and production activities such as hydraulic fracturing; governmental/regulatory actions, initiatives and proceedings, including those involving rate cases (which address, among other things, target rates of return, rate design, retained natural gas and system modernization), environmental/safety requirements, affiliate relationships, industry structure, and franchise renewal; the Company’s ability to estimate accurately the time and resources necessary to meet emissions targets; governmental/regulatory actions and/or market pressures to reduce or eliminate reliance on natural gas; changes in economic conditions, including inflationary pressures, supply chain issues, liquidity challenges, and global, national or regional recessions, and their effect on the demand for, and customers’ ability to pay for, the Company’s products and services; changes in the price of natural gas; the creditworthiness or performance of the Company’s key suppliers, customers and counterparties; financial and economic conditions, including the availability of credit, and occurrences affecting the Company’s ability to obtain financing on acceptable terms for working capital, capital expenditures and other investments, including any downgrades in the Company’s credit ratings and changes in interest rates and other capital market conditions; impairments under the SEC’s full cost ceiling test for natural gas reserves; increased costs or delays or changes in plans with respect to Company projects or related projects of other companies, as well as difficulties or delays in obtaining necessary governmental approvals, permits or orders or in obtaining the cooperation of interconnecting facility operators; the Company’s ability to complete planned strategic transactions; changes in price differentials between similar quantities of natural gas sold at different geographic locations, and the effect of such changes on commodity production, revenues and demand for pipeline transportation capacity to or from such locations; the impact of information technology disruptions, cybersecurity or data security breaches; factors affecting the Company’s ability to successfully identify, drill for and produce economically viable natural gas reserves, including among others geology, lease availability and costs, title disputes, weather conditions, shortages, delays or unavailability of equipment and services required in drilling operations, insufficient gathering, processing and transportation capacity, the need to obtain governmental approvals and permits, and compliance with environmental laws and regulations; increasing health care costs and the resulting effect on health insurance premiums and on the obligation to provide other post-retirement benefits; other changes in price differentials between similar quantities of natural gas having different quality, heating value, hydrocarbon mix or delivery date; the cost and effects of legal and administrative claims against the Company or activist shareholder campaigns to effect changes at the Company; negotiations with the collective bargaining units representing the Company's workforce, including potential work stoppages during negotiations; uncertainty of natural gas reserve estimates; significant differences between the Company’s projected and actual production levels for natural gas; changes in demographic patterns and weather conditions (including those related to climate change); changes in the availability, price or accounting treatment of derivative financial instruments; changes in laws, actuarial assumptions, the interest rate environment and the return on plan/trust assets related to the Company’s pension and other post-retirement benefits, which can affect future funding obligations and costs and plan liabilities; economic disruptions or uninsured losses resulting from major accidents, fires, severe weather, natural disasters, terrorist activities or acts of war, as well as economic and operational disruptions due to third-party outages; significant differences between the Company’s projected and actual capital expenditures and operating expenses; or increasing costs of insurance, changes in coverage and the ability to obtain insurance. The Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date thereof.


    NATIONAL FUEL GAS COMPANY
    AND SUBSIDIARIES

    GUIDANCE SUMMARY

    As discussed on page 2, the Company is revising its earnings guidance for fiscal 2023. Additional details on the Company's forecast assumptions and business segment guidance are outlined in the table below.

    While the Company expects to record certain adjustments to unrealized gain or loss on investments during the nine months ending September 30, 2023, the amounts of these and other potential adjustments are not reasonably determinable at this time. As such, the Company is unable to provide earnings guidance other than on a non-GAAP basis.

     Previous FY 2023 Guidance Updated FY 2023 Guidance
    Consolidated Earnings per Share, excluding items impacting comparability$6.40 to $6.90 $5.35 to $5.75
    Consolidated Effective Tax Rate~ 25.5 - 26% ~ 25 - 25.5%
        
    Capital Expenditures (Millions)   
    Exploration and Production$525 - $575 $525 - $575
    Pipeline and Storage$110 - $130 $110 - $130
    Gathering$85 - $105 $85 - $105
    Utility$110 - $130 $110 - $130
    Consolidated Capital Expenditures$830 - $940 $830 - $940
        
    Exploration & Production Segment Guidance*   
        
    Commodity Price Assumptions   
    NYMEX natural gas price (Oct - Mar | Apr - Sep)$6.00 /MMBtu l $4.75 /MMBtu $3.25 /MMBtu
    Appalachian basin spot price (Oct - Mar | Apr - Sep)$4.95 /MMBtu l $3.55 /MMBtu $2.25 /MMBtu
        
    Production (Bcfe)370 to 390 370 to 390
        
    E&P Operating Costs ($/Mcfe)   
    LOE$0.67 - $0.69 $0.67 - $0.69
    G&A$0.17 - $0.19 $0.17 - $0.19
    DD&A$0.60 - $0.64 $0.60 - $0.64
        
    Other Business Segment Guidance (Millions)   
    Gathering Segment Revenues$230 - $245 $230 - $245
    Pipeline and Storage Segment Revenues$360 - $380 $360 - $380

    * Commodity price assumptions are for the remaining 9 months of the fiscal year. Previous guidance included separate pricing assumptions for October - March and April - September.

     
    NATIONAL FUEL GAS COMPANY
    RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS
    QUARTER ENDED DECEMBER 31, 2022
    (Unaudited)
                
     Upstream Midstream Downstream    
                
     Exploration & Pipeline &     Corporate /  
    (Thousands of Dollars)Production Storage Gathering Utility All Other Consolidated*
                
    First quarter 2022 GAAP earnings$62,369  $25,168  $23,137  $22,130  $(412) $132,392 
    Items impacting comparability:           
    Unrealized (gain) loss on other investments         4,490   4,490 
    Tax impact of unrealized (gain) loss on other investments         (943)  (943)
    First quarter 2022 adjusted operating results 62,369   25,168   23,137   22,130   3,135   135,939 
    Drivers of adjusted operating results**           
    Upstream Revenues           
    Higher (lower) natural gas production 17,445           17,445 
    Higher (lower) crude oil production (27,438)          (27,438)
    Higher (lower) realized natural gas prices, after hedging 35,798           35,798 
    Midstream Revenues           
    Higher (lower) operating revenues   7,351   3,309       10,660 
    Downstream Margins***           
    Impact of usage and weather       3,268     3,268 
    Impact of new rates****       (3,726)    (3,726)
    System modernization tracker revenues       868     868 
    Regulatory revenue adjustments       170     170 
    Higher (lower) other operating revenues       1,023     1,023 
    Operating Expenses           
    Lower (higher) lease operating and transportation expenses 5,996           5,996 
    Lower (higher) operating expenses 3,325   (1,458)  (1,184)  (2,390)    (1,707)
    Lower (higher) property, franchise and other taxes (981)          (981)
    Lower (higher) depreciation / depletion (4,781)  (1,274)        (6,055)
    Other Income (Expense)           
    (Higher) lower other deductions 1,428   593     4,135   (4,441)  1,715 
    (Higher) lower interest expense (871)  (648)    (2,028)  1,721   (1,826)
    Income Taxes           
    Lower (higher) income tax expense / effective tax rate (1,185)  (191)  (552)  (67)  47   (1,948)
    All other / rounding 87   (65)  28   434   (161)  323 
    First quarter 2023 adjusted operating results 91,192   29,476   24,738   23,817   301   169,524 
    Items impacting comparability:           
    Unrealized gain (loss) on other investments         209   209 
    Tax impact of unrealized gain (loss) on other investments         (44)  (44)
    First quarter 2023 GAAP earnings$91,192  $29,476  $24,738  $23,817  $466  $169,689 
                
    * Amounts do not reflect intercompany eliminations.
    ** Drivers of adjusted operating results have been calculated using the 21% federal statutory rate.
    *** Downstream margin defined as operating revenues less purchased gas expense.
    **** Amount is offset by corresponding decrease in other deductions and will have no earnings impact for the year ended September 30, 2023.
     


     
    NATIONAL FUEL GAS COMPANY
    RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS PER SHARE
    QUARTER ENDED DECEMBER 31, 2022
    (Unaudited)
                
     Upstream Midstream Downstream    
                
     Exploration & Pipeline &     Corporate /  
     Production Storage Gathering Utility All Other Consolidated*
                
    First quarter 2022 GAAP earnings per share$0.68  $0.27  $0.25  $0.24  $—  $1.44 
    Items impacting comparability:           
    Unrealized (gain) loss on other investments, net of tax         0.04   0.04 
    First quarter 2022 adjusted operating results per share 0.68   0.27   0.25   0.24   0.04   1.48 
    Drivers of adjusted operating results**           
    Upstream Revenues           
    Higher (lower) natural gas production 0.19           0.19 
    Higher (lower) crude oil production (0.30)          (0.30)
    Higher (lower) realized natural gas prices, after hedging 0.39           0.39 
    Midstream Revenues           
    Higher (lower) operating revenues   0.08   0.04       0.12 
    Downstream Margins***           
    Impact of usage and weather       0.04     0.04 
    Impact of new rates****       (0.04)    (0.04)
    System modernization tracker revenues       0.01     0.01 
    Regulatory revenue adjustments       —     — 
    Higher (lower) other operating revenues       0.01     0.01 
    Operating Expenses           
    Lower (higher) lease operating and transportation expenses 0.06           0.06 
    Lower (higher) operating expenses 0.04   (0.02)  (0.01)  (0.03)    (0.02)
    Lower (higher) property, franchise and other taxes (0.01)          (0.01)
    Lower (higher) depreciation / depletion (0.05)  (0.01)        (0.06)
    Other Income (Expense)           
    (Higher) lower other deductions 0.02   0.01     0.04   (0.05)  0.02 
    (Higher) lower interest expense (0.01)  (0.01)    (0.02)  0.02   (0.02)
    Income Taxes           
    Lower (higher) income tax expense / effective tax rate (0.01)  —   (0.01)  —   —   (0.02)
    All other / rounding (0.01)  —   —   0.01   (0.01)  (0.01)
    First quarter 2023 adjusted operating results per share 0.99   0.32   0.27   0.26   —   1.84 
    Items impacting comparability:           
    Unrealized gain (loss) on other investments, net of tax         —   — 
    First quarter 2023 GAAP earnings per share$0.99  $0.32  $0.27  $0.26  $—  $1.84 
                
    * Amounts do not reflect intercompany eliminations.
    ** Drivers of adjusted operating results have been calculated using the 21% federal statutory rate.
    *** Downstream margin defined as operating revenues less purchased gas expense.
    **** Amount is offset by corresponding decrease in other deductions and will have no earnings impact for the year ended September 30, 2023.
     


        
    NATIONAL FUEL GAS COMPANY
    AND SUBSIDIARIES
        
    (Thousands of Dollars, except per share amounts)   
     Three Months Ended
     December 31,
     (Unaudited)
    SUMMARY OF OPERATIONS2022 2021
    Operating Revenues:   
    Utility Revenues$311,619  $236,684 
    Exploration and Production and Other Revenues 276,973   244,281 
    Pipeline and Storage and Gathering Revenues 70,267   65,592 
      658,859   546,557 
    Operating Expenses:   
    Purchased Gas 171,197   101,628 
    Operation and Maintenance:   
    Utility 50,352   46,644 
    Exploration and Production and Other 26,874   45,619 
    Pipeline and Storage and Gathering 33,261   29,928 
    Property, Franchise and Other Taxes 26,205   24,501 
    Depreciation, Depletion and Amortization 96,600   88,578 
      404,489   336,898 
        
    Operating Income 254,370   209,659 
        
    Other Income (Expense):   
    Other Income (Deductions) 6,318   (1,079)
    Interest Expense on Long-Term Debt (29,604)  (30,130)
    Other Interest Expense (3,843)  (1,161)
        
    Income Before Income Taxes 227,241   177,289 
        
    Income Tax Expense 57,552   44,897 
        
    Net Income Available for Common Stock$169,689  $132,392 
        
    Earnings Per Common Share   
    Basic$1.85  $1.45 
    Diluted$1.84  $1.44 
        
    Weighted Average Common Shares:   
    Used in Basic Calculation 91,579,814   91,266,300 
    Used in Diluted Calculation 92,268,210   92,032,775 
            


     
    NATIONAL FUEL GAS COMPANY
    AND SUBSIDIARIES
    CONSOLIDATED BALANCE SHEETS
    (Unaudited)
      
     December 31, September 30,
    (Thousands of Dollars)2022 2022
    ASSETS   
    Property, Plant and Equipment$12,773,470  $12,551,909 
    Less - Accumulated Depreciation, Depletion and Amortization 6,074,626   5,985,432 
    Net Property, Plant and Equipment 6,698,844   6,566,477 
    Current Assets:   
    Cash and Temporary Cash Investments 244,475   46,048 
    Hedging Collateral Deposits 1,600   91,670 
    Receivables - Net 332,410   361,626 
    Unbilled Revenue 87,110   30,075 
    Gas Stored Underground 23,780   32,364 
    Materials and Supplies - at average cost 43,599   40,637 
    Unrecovered Purchased Gas Costs 78,739   99,342 
    Other Current Assets 61,117   59,369 
    Total Current Assets 872,830   761,131 
    Other Assets:   
    Recoverable Future Taxes 107,467   106,247 
    Unamortized Debt Expense 8,473   8,884 
    Other Regulatory Assets 73,321   67,101 
    Deferred Charges 75,253   77,472 
    Other Investments 72,870   95,025 
    Goodwill 5,476   5,476 
    Prepaid Pension and Post-Retirement Benefit Costs 206,629   196,597 
    Fair Value of Derivative Financial Instruments 12,170   9,175 
    Other 1,581   2,677 
    Total Other Assets 563,240   568,654 
    Total Assets$8,134,914  $7,896,262 
    CAPITALIZATION AND LIABILITIES   
    Capitalization:   
    Comprehensive Shareholders' Equity   
    Common Stock, $1 Par Value Authorized - 200,000,000 Shares; Issued and   
    Outstanding - 91,786,806 Shares and 91,478,064 Shares, Respectively$91,787  $91,478 
    Paid in Capital 1,025,639   1,027,066 
    Earnings Reinvested in the Business 1,713,176   1,587,085 
    Accumulated Other Comprehensive Loss (293,746)  (625,733)
    Total Comprehensive Shareholders' Equity 2,536,856   2,079,896 
    Long-Term Debt, Net of Current Portion and Unamortized Discount and Debt Issuance Costs 2,084,363   2,083,409 
    Total Capitalization 4,621,219   4,163,305 
    Current and Accrued Liabilities:   
    Notes Payable to Banks and Commercial Paper 250,000   60,000 
    Current Portion of Long-Term Debt 399,000   549,000 
    Accounts Payable 168,387   178,945 
    Amounts Payable to Customers 154   419 
    Dividends Payable 43,598   43,452 
    Interest Payable on Long-Term Debt 43,142   17,376 
    Customer Advances 31,314   26,108 
    Customer Security Deposits 28,829   24,283 
    Other Accruals and Current Liabilities 239,097   257,327 
    Fair Value of Derivative Financial Instruments 331,521   785,659 
    Total Current and Accrued Liabilities 1,535,042   1,942,569 
    Other Liabilities:   
    Deferred Income Taxes 879,676   698,229 
    Taxes Refundable to Customers 360,276   362,098 
    Cost of Removal Regulatory Liability 263,707   259,947 
    Other Regulatory Liabilities 191,499   188,803 
    Other Post-Retirement Liabilities 2,998   3,065 
    Asset Retirement Obligations 161,221   161,545 
    Other Liabilities 119,276   116,701 
    Total Other Liabilities 1,978,653   1,790,388 
    Commitments and Contingencies —   — 
    Total Capitalization and Liabilities$8,134,914  $7,896,262 



         
    NATIONAL FUEL GAS COMPANY
    AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF CASH FLOWS
    (Unaudited)
      Three Months Ended
      December 31,
    (Thousands of Dollars) 2022 2021
         
    Operating Activities:    
    Net Income Available for Common Stock $169,689  $132,392 
    Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities:    
    Depreciation, Depletion and Amortization  96,600   88,578 
    Deferred Income Taxes  53,457   44,122 
    Stock-Based Compensation  5,575   5,487 
    Other  4,078   4,675 
    Change in:    
    Receivables and Unbilled Revenue  (29,522)  (98,688)
    Gas Stored Underground and Materials, Supplies and Emission Allowances  5,622   17,111 
    Unrecovered Purchased Gas Costs  20,603   526 
    Other Current Assets  (1,748)  (4,654)
    Accounts Payable  6,091   (10,888)
    Amounts Payable to Customers  (265)  15 
    Customer Advances  5,206   (2,603)
    Customer Security Deposits  4,546   981 
    Other Accruals and Current Liabilities  4,523   5,044 
    Other Assets  (20,238)  (6,838)
    Other Liabilities  3,122   (3,777)
    Net Cash Provided by Operating Activities $327,339  $171,483 
         
    Investing Activities:    
    Capital Expenditures $(233,473) $(213,491)
    Sale of Fixed Income Mutual Fund Shares in Grantor Trust  10,000   30,000 
    Other  14,637   13,781 
    Net Cash Used in Investing Activities $(208,836) $(169,710)
         
    Financing Activities:    
    Proceeds from Issuance of Short-Term Note Payable to Bank $250,000  $— 
    Net Change in Other Short-Term Notes Payable to Banks and Commercial Paper  (60,000)  7,500 
    Reduction of Long-Term Debt  (150,000)  — 
    Dividends Paid on Common Stock  (43,452)  (41,487)
    Net Repurchases of Common Stock  (6,694)  (8,859)
    Net Cash Used in Financing Activities $(10,146) $(42,846)
         
    Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash  108,357   (41,073)
    Cash, Cash Equivalents, and Restricted Cash at Beginning of Period  137,718   120,138 
    Cash, Cash Equivalents, and Restricted Cash at December 31 $246,075  $79,065 



          
    NATIONAL FUEL GAS COMPANY
    AND SUBSIDIARIES
          
    SEGMENT OPERATING RESULTS AND STATISTICS
    (UNAUDITED)
          
    UPSTREAM BUSINESS
          
          
     Three Months Ended
    (Thousands of Dollars, except per share amounts)December 31,
    EXPLORATION AND PRODUCTION SEGMENT2022 2021 Variance
    Total Operating Revenues$276,973  $244,198  $32,775 
    Operating Expenses:     
    Operation and Maintenance:     
    General and Administrative Expense 15,598   17,756   (2,158)
    Lease Operating and Transportation Expense 61,546   69,136   (7,590)
    All Other Operation and Maintenance Expense 2,523   4,573   (2,050)
    Property, Franchise and Other Taxes 6,976   5,734   1,242 
    Depreciation, Depletion and Amortization 55,558   49,506   6,052 
      142,201   146,705   (4,504)
          
    Operating Income 134,772   97,493   37,279 
          
    Other Income (Expense):     
    Non-Service Pension and Post-Retirement Benefit (Costs) Credit 347   (186)  533 
    Interest and Other Income 1,331   56   1,275 
    Interest Expense (13,234)  (12,132)  (1,102)
    Income Before Income Taxes 123,216   85,231   37,985 
    Income Tax Expense 32,024   22,862   9,162 
    Net Income$91,192  $62,369  $28,823 
    Net Income Per Share (Diluted)$0.99  $0.68  $0.31 
          


          
    NATIONAL FUEL GAS COMPANY
    AND SUBSIDIARIES
          
    SEGMENT OPERATING RESULTS AND STATISTICS
    (UNAUDITED)
          
    MIDSTREAM BUSINESSES
          
     Three Months Ended
    (Thousands of Dollars, except per share amounts)December 31,
    PIPELINE AND STORAGE SEGMENT2022 2021 Variance
    Revenues from External Customers$67,621  $61,547  $6,074 
    Intersegment Revenues 30,034   26,803   3,231 
    Total Operating Revenues 97,655   88,350   9,305 
    Operating Expenses:     
    Purchased Gas 425   448   (23)
    Operation and Maintenance 24,018   22,172   1,846 
    Property, Franchise and Other Taxes 8,684   8,580   104 
    Depreciation, Depletion and Amortization 17,414   15,801   1,613 
      50,541   47,001   3,540 
          
    Operating Income 47,114   41,349   5,765 
          
    Other Income (Expense):     
    Non-Service Pension and Post-Retirement Benefit Credit 1,330   767   563 
    Interest and Other Income 1,864   1,402   462 
    Interest Expense (10,952)  (10,132)  (820)
    Income Before Income Taxes 39,356   33,386   5,970 
    Income Tax Expense 9,880   8,218   1,662 
    Net Income$29,476  $25,168  $4,308 
    Net Income Per Share (Diluted)$0.32  $0.27  $0.05 
          
          
     Three Months Ended
     December 31,
    GATHERING SEGMENT2022 2021 Variance
    Revenues from External Customers$2,646  $4,045  $(1,399)
    Intersegment Revenues 53,767   48,180   5,587 
    Total Operating Revenues 56,413   52,225   4,188 
    Operating Expenses:     
    Operation and Maintenance 9,687   8,188   1,499 
    Property, Franchise and Other Taxes 11   5   6 
    Depreciation, Depletion and Amortization 8,709   8,391   318 
      18,407   16,584   1,823 
          
    Operating Income 38,006   35,641   2,365 
          
    Other Income (Expense):     
    Non-Service Pension and Post-Retirement Benefit (Costs) Credit 37   (56)  93 
    Interest and Other Income 170   9   161 
    Interest Expense (4,042)  (4,148)  106 
    Income Before Income Taxes 34,171   31,446   2,725 
    Income Tax Expense 9,433   8,309   1,124 
    Net Income$24,738  $23,137  $1,601 
    Net Income Per Share (Diluted)$0.27  $0.25  $0.02 
          


          
    NATIONAL FUEL GAS COMPANY
    AND SUBSIDIARIES
          
    SEGMENT OPERATING RESULTS AND STATISTICS
    (UNAUDITED)
          
    DOWNSTREAM BUSINESS
          
          
     Three Months Ended
    (Thousands of Dollars, except per share amounts)December 31,
    UTILITY SEGMENT2022 2021 Variance
    Revenues from External Customers$311,619  $236,684  $74,935 
    Intersegment Revenues 62   75   (13)
    Total Operating Revenues 311,681   236,759   74,922 
    Operating Expenses:     
    Purchased Gas 198,420   127,212   71,208 
    Operation and Maintenance 51,276   47,461   3,815 
    Property, Franchise and Other Taxes 10,408   10,058   350 
    Depreciation, Depletion and Amortization 14,874   14,831   43 
      274,978   199,562   75,416 
          
    Operating Income 36,703   37,197   (494)
          
    Other Income (Expense):     
    Non-Service Pension and Post-Retirement Benefit Costs (8)  (4,326)  4,318 
    Interest and Other Income 1,440   525   915 
    Interest Expense (8,043)  (5,524)  (2,519)
    Income Before Income Taxes 30,092   27,872   2,220 
    Income Tax Expense 6,275   5,742   533 
    Net Income$23,817  $22,130  $1,687 
    Net Income Per Share (Diluted)$0.26  $0.24  $0.02 
          


     
    NATIONAL FUEL GAS COMPANY
    AND SUBSIDIARIES
          
    SEGMENT OPERATING RESULTS AND STATISTICS
    (UNAUDITED)
          
     Three Months Ended
    (Thousands of Dollars, except per share amounts)December 31,
    ALL OTHER2022 2021 Variance
    Revenues from External Customers$—  $—  $— 
    Intersegment Revenues —   6   (6)
    Total Operating Revenues —   6   (6)
    Operating Expenses:     
    Purchased Gas —   6   (6)
    Operation and Maintenance 21   5   16 
      21   11   10 
          
    Operating Loss (21)  (5)  (16)
    Other Income (Expense):     
    Interest and Other Income (324)  2   (326)
    Interest Expense (21)  —   (21)
    Loss before Income Taxes (366)  (3)  (363)
    Income Tax Expense (Benefit) (86)  4   (90)
    Net Loss$(280) $(7) $(273)
    Net Loss Per Share (Diluted)$(0.01) $—  $(0.01)
      
     Three Months Ended
     December 31,
    CORPORATE2022 2021 Variance
    Revenues from External Customers$—  $83  $(83)
    Intersegment Revenues 1,152   1,082   70 
    Total Operating Revenues 1,152   1,165   (13)
    Operating Expenses:     
    Operation and Maintenance 3,185   3,008   177 
    Property, Franchise and Other Taxes 126   124   2 
    Depreciation, Depletion and Amortization 45   49   (4)
      3,356   3,181   175 
          
    Operating Loss (2,204)  (2,016)  (188)
    Other Income (Expense):     
    Non-Service Pension and Post-Retirement Benefit Costs (354)  (1,017)  663 
    Interest and Other Income 37,877   33,177   4,700 
    Interest Expense on Long-Term Debt (29,604)  (30,130)  526 
    Other Interest Expense (4,943)  (657)  (4,286)
    Net Income (Loss) before Income Taxes 772   (643)  1,415 
    Income Tax Expense (Benefit) 26   (238)  264 
    Net Income (Loss)$746  $(405) $1,151 
    Net Income (Loss) Per Share (Diluted)$0.01  $—  $0.01 
          
          
     Three Months Ended
     December 31,
    INTERSEGMENT ELIMINATIONS2022 2021 Variance
    Intersegment Revenues$(85,015) $(76,146) $(8,869)
    Operating Expenses:     
    Purchased Gas (27,648)  (26,038)  (1,610)
    Operation and Maintenance (57,367)  (50,108)  (7,259)
      (85,015)  (76,146)  (8,869)
    Operating Income —   —   — 
    Other Income (Expense):     
    Interest and Other Deductions (37,392)  (31,432)  (5,960)
    Interest Expense 37,392   31,432   5,960 
    Net Income$—  $—  $— 
    Net Income Per Share (Diluted)$—  $—  $— 
                


          
    NATIONAL FUEL GAS COMPANY
    AND SUBSIDIARIES
          
    SEGMENT INFORMATION (Continued)
    (Thousands of Dollars)
          
          
     Three Months Ended
     December 31,
     (Unaudited)
         Increase
     2022 2021 (Decrease)
          
    Capital Expenditures:     
    Exploration and Production$168,505 (1)(2)$139,212 (3)(4)$29,293 
    Pipeline and Storage 16,427 (1)(2) 24,061 (3)(4) (7,634)
    Gathering 13,293 (1)(2) 8,920 (3)(4) 4,373 
    Utility 25,288 (1)(2) 19,383 (3)(4) 5,905 
    Total Reportable Segments 223,513   191,576   31,937 
    All Other —   —   — 
    Corporate 12   225   (213)
    Total Capital Expenditures$223,525  $191,801  $31,724 


    (1) Capital expenditures for the quarter ended December 31, 2022, include accounts payable and accrued liabilities related to capital expenditures of $102.9 million, $2.1 million, $1.1 million, and $4.2 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts have been excluded from the Consolidated Statement of Cash Flows at December 31, 2022, since they represent non-cash investing activities at that date.
       
    (2) Capital expenditures for the quarter ended December 31, 2022, exclude capital expenditures of $83.0 million, $15.2 million, $10.7 million and $11.4 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts were in accounts payable and accrued liabilities at September 30, 2022 and paid during the quarter ended December 31, 2022. These amounts were excluded from the Consolidated Statement of Cash Flows at September 30, 2022, since they represented non-cash investing activities at that date. These amounts have been included in the Consolidated Statement of Cash Flows at December 31, 2022.
       
    (3) Capital expenditures for the quarter ended December 31, 2021, include accounts payable and accrued liabilities related to capital expenditures of $69.9 million, $5.4 million, $2.6 million, and $3.1 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts have been excluded from the Consolidated Statement of Cash Flows at December 31, 2021, since they represent non-cash investing activities at that date.
       
    (4) Capital expenditures for the quarter ended December 31, 2021, exclude capital expenditures of $47.9 million, $39.4 million, $4.8 million and $10.6 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts were in accounts payable and accrued liabilities at September 30, 2021 and paid during the quarter ended December 31, 2021. These amounts were excluded from the Consolidated Statement of Cash Flows at September 30, 2021, since they represented non-cash investing activities at that date. These amounts have been included in the Consolidated Statement of Cash Flows at December 31, 2021.
       


                  
    DEGREE DAYS             
              Percent Colder
              (Warmer) Than:
    Three Months Ended December 31,Normal 2022 2021 Normal(1) Last Year(1)
    Buffalo, NY2,253  2,048  1,704  (9.1) 20.2 
    Erie, PA2,044  1,987  1,560  (2.8) 27.4 


    (1) Percents compare actual 2022 degree days to normal degree days and actual 2022 degree days to actual 2021 degree days.
       


           
    NATIONAL FUEL GAS COMPANY
    AND SUBSIDIARIES
           
    EXPLORATION AND PRODUCTION INFORMATION
           
           
      Three Months Ended
      December 31,
          Increase
      2022 2021 (Decrease)
           
    Gas Production/Prices:      
    Production (MMcf)      
    Appalachia  90,574   81,389   9,185 
    West Coast  —   408   (408)
    Total Production  90,574   81,797   8,777 
           
    Average Prices (Per Mcf)      
    Appalachia $4.77  $4.39  $0.38 
    West Coast N/M   9.79  N/M 
    Weighted Average  4.77   4.42   0.35 
    Weighted Average after Hedging  3.02   2.52   0.50 
           
    Oil Production/Prices:      
    Production (Thousands of Barrels)      
    Appalachia  8   —   8 
    West Coast  —   548   (548)
    Total Production  8   548   (540)
           
    Average Prices (Per Barrel)      
    Appalachia $82.09  $70.86  $11.23 
    West Coast N/M   77.34  N/M 
    Weighted Average  82.09   77.34   4.75 
    Weighted Average after Hedging  82.09   64.29   17.80 
           
    Total Production (MMcfe)  90,622   85,085   5,537 
           
    Selected Operating Performance Statistics:      
    General & Administrative Expense per Mcfe(1) $0.17  $0.21  $(0.04)
    Lease Operating and Transportation Expense per Mcfe(1)(2) $0.68  $0.81  $(0.13)
    Depreciation, Depletion & Amortization per Mcfe(1) $0.61  $0.58  $0.03 
           


    N/M Not Meaningful (as a result of the sale of Seneca's West Coast assets in June 2022)
       
    (1) Refer to page 13 for the General and Administrative Expense, Lease Operating and Transportation Expense and Depreciation, Depletion, and Amortization Expense for the Exploration and Production segment.
       
    (2) Amounts include transportation expense of $0.59 and $0.56 per Mcfe for the three months ended December 31, 2022 and December 31, 2021, respectively.
       


     
    NATIONAL FUEL GAS COMPANY
    AND SUBSIDIARIES
            
    EXPLORATION AND PRODUCTION INFORMATION
     
    Hedging Summary for Remaining Nine Months of Fiscal 2023 Volume  Average Hedge Price
    Gas Swaps       
    NYMEX 80,460,000 MMBTU $2.80 / MMBTU
    No Cost Collars 67,080,000 MMBTU $3.34 / MMBTU (Floor) / $3.99 / MMBTU (Ceiling)
    Fixed Price Physical Sales 54,466,307 MMBTU $2.47 / MMBTU
    Total 202,006,307 MMBTU   
            
    Hedging Summary for Fiscal 2024 Volume  Average Hedge Price
    Gas Swaps       
    NYMEX 67,680,000 MMBTU $2.98 / MMBTU
    No Cost Collars 65,280,000 MMBTU $3.33 / MMBTU (Floor) / $4.17 / MMBTU (Ceiling)
    Fixed Price Physical Sales 65,607,429 MMBTU $2.38 / MMBTU
    Total 198,567,429 MMBTU   
            
    Hedging Summary for Fiscal 2025 Volume  Average Hedge Price
    Gas Swaps       
    NYMEX 27,560,000 MMBTU $3.07 / MMBTU
    No Cost Collars 43,960,000 MMBTU $3.49 / MMBTU (Floor) / $4.65 / MMBTU (Ceiling)
    Fixed Price Physical Sales 64,221,273 MMBTU $2.43 / MMBTU
    Total 135,741,273 MMBTU   
            
    Hedging Summary for Fiscal 2026 Volume  Average Hedge Price
    Gas Swaps       
    NYMEX 2,020,000 MMBTU $3.09 / MMBTU
    No Cost Collars 42,720,000 MMBTU $3.53 / MMBTU (Floor) / $4.76 / MMBTU (Ceiling)
    Fixed Price Physical Sales 62,453,675 MMBTU $2.37 / MMBTU
    Total 107,193,675 MMBTU   
            
    Hedging Summary for Fiscal 2027 Volume  Average Hedge Price
    No Cost Collars 3,560,000 MMBTU $3.53 / MMBTU (Floor) / $4.76 / MMBTU (Ceiling)
    Fixed Price Physical Sales 45,517,002 MMBTU $2.39 / MMBTU
    Total 49,077,002 MMBTU   
            
    Hedging Summary for Fiscal 2028 Volume  Average Hedge Price
    Fixed Price Physical Sales 11,850,451 MMBTU $2.48 / MMBTU
            
    Hedging Summary for Fiscal 2029 Volume  Average Hedge Price
    Fixed Price Physical Sales 766,673 MMBTU $2.54 / MMBTU
            


              
    NATIONAL FUEL GAS COMPANY
    AND SUBSIDIARIES
              
              
              
    Pipeline & Storage Throughput - (millions of cubic feet - MMcf)
              
      Three Months Ended
      December 31,
            Increase
      2022 2021 (Decrease)
    Firm Transportation - Affiliated 38,469  28,197  10,272 
    Firm Transportation - Non-Affiliated 186,154  165,397  20,757 
    Interruptible Transportation 1,308  767  541 
      225,931  194,361  31,570 
              
    Gathering Volume - (MMcf)         
      Three Months Ended
      December 31,
            Increase
      2022 2021 (Decrease)
    Gathered Volume 108,027  101,094  6,933 
              
              
    Utility Throughput - (MMcf)         
      Three Months Ended
      December 31,
            Increase
      2022 2021 (Decrease)
    Retail Sales:         
    Residential Sales 20,153  17,496  2,657 
    Commercial Sales 2,994  2,543  451 
    Industrial Sales 151  123  28 
      23,298  20,162  3,136 
    Transportation 18,310  17,593  717 
      41,608  37,755  3,853 
              


    NATIONAL FUEL GAS COMPANY
    AND SUBSIDIARIES

    NON-GAAP FINANCIAL MEASURES

    In addition to financial measures calculated in accordance with generally accepted accounting principles (GAAP), this press release contains information regarding Adjusted Operating Results, Adjusted EBITDA and free cash flow, which are non-GAAP financial measures. The Company believes that these non-GAAP financial measures are useful to investors because they provide an alternative method for assessing the Company's ongoing operating results or liquidity and for comparing the Company’s financial performance to other companies. The Company's management uses these non-GAAP financial measures for the same purpose, and for planning and forecasting purposes. The presentation of non-GAAP financial measures is not meant to be a substitute for financial measures in accordance with GAAP.

    Management defines Adjusted Operating Results as reported GAAP earnings before items impacting comparability. The following table reconciles National Fuel's reported GAAP earnings to Adjusted Operating Results for the three months ended December 31, 2022 and 2021:

      Three Months Ended
      December 31,
    (in thousands except per share amounts) 2022 2021
    Reported GAAP Earnings $169,689  $132,392 
    Items impacting comparability:    
    Unrealized (gain) loss on other investments (Corporate / All Other)  (209)  4,490 
    Tax impact of unrealized (gain) loss on other investments  44   (943)
    Adjusted Operating Results $169,524  $135,939 
         
    Reported GAAP Earnings Per Share $1.84  $1.44 
    Items impacting comparability:    
    Unrealized (gain) loss on other investments, net of tax (Corporate / All Other)  —   0.04 
    Adjusted Operating Results Per Share $1.84  $1.48 
             

    Management defines Adjusted EBITDA as reported GAAP earnings before the following items: interest expense, income taxes, depreciation, depletion and amortization, other income and deductions, impairments, and other items reflected in operating income that impact comparability. The following tables reconcile National Fuel's reported GAAP earnings to Adjusted EBITDA for the three months ended December 31, 2022 and 2021:

      Three Months Ended
      December 31,
    (in thousands) 2022 2021
    Reported GAAP Earnings $169,689  $132,392 
    Depreciation, Depletion and Amortization  96,600   88,578 
    Other (Income) Deductions  (6,318)  1,079 
    Interest Expense  33,447   31,291 
    Income Taxes  57,552   44,897 
    Adjusted EBITDA $350,970  $298,237 
         
    Adjusted EBITDA by Segment    
    Pipeline and Storage Adjusted EBITDA $64,528  $57,150 
    Gathering Adjusted EBITDA  46,715   44,032 
    Total Midstream Businesses Adjusted EBITDA  111,243   101,182 
    Exploration and Production Adjusted EBITDA  190,330   146,999 
    Utility Adjusted EBITDA  51,577   52,028 
    Corporate and All Other Adjusted EBITDA  (2,180)  (1,972)
    Total Adjusted EBITDA $350,970  $298,237 
             


    NATIONAL FUEL GAS COMPANY
    AND SUBSIDIARIES
    NON-GAAP FINANCIAL MEASURES
    SEGMENT ADJUSTED EBITDA

      Three Months Ended
      December 31,
    (in thousands) 2022 2021
    Exploration and Production Segment    
    Reported GAAP Earnings $91,192  $62,369 
    Depreciation, Depletion and Amortization  55,558   49,506 
    Other (Income) Deductions  (1,678)  130 
    Interest Expense  13,234   12,132 
    Income Taxes  32,024   22,862 
    Adjusted EBITDA $190,330  $146,999 
         
    Pipeline and Storage Segment    
    Reported GAAP Earnings $29,476  $25,168 
    Depreciation, Depletion and Amortization  17,414   15,801 
    Other (Income) Deductions  (3,194)  (2,169)
    Interest Expense  10,952   10,132 
    Income Taxes  9,880   8,218 
    Adjusted EBITDA $64,528  $57,150 
         
    Gathering Segment    
    Reported GAAP Earnings $24,738  $23,137 
    Depreciation, Depletion and Amortization  8,709   8,391 
    Other (Income) Deductions  (207)  47 
    Interest Expense  4,042   4,148 
    Income Taxes  9,433   8,309 
    Adjusted EBITDA $46,715  $44,032 
         
    Utility Segment    
    Reported GAAP Earnings $23,817  $22,130 
    Depreciation, Depletion and Amortization  14,874   14,831 
    Other (Income) Deductions  (1,432)  3,801 
    Interest Expense  8,043   5,524 
    Income Taxes  6,275   5,742 
    Adjusted EBITDA $51,577  $52,028 
         
    Corporate and All Other    
    Reported GAAP Earnings $466  $(412)
    Depreciation, Depletion and Amortization  45   49 
    Other (Income) Deductions  193   (730)
    Interest Expense  (2,824)  (645)
    Income Taxes  (60)  (234)
    Adjusted EBITDA $(2,180) $(1,972)
             

    Management defines free cash flow as funds from operations (net cash provided by operating activities less changes in working capital) less capital expenditures. The Company is unable to provide a reconciliation of projected free cash flow as described in this release to its comparable financial measure calculated in accordance with GAAP without unreasonable efforts. This is due to our inability to calculate the comparable GAAP projected metrics, including operating income and total production costs, given the unknown effect, timing, and potential significance of certain income statement items.


    Brandon J. Haspett
Investor Relations 
716-857-7697

Karen M. Camiolo
Treasurer 
716-857-7344

    Primary Logo

分享