Good morning and welcome to New Jersey Resources' First Quarter Fiscal 2017 Earnings Conference Call. All participants will be in listen only mode. [Operator Instructions] After today’s presentation there will be an opportunity to ask question. [Operator Instructions] Please note this event has been recorded. I’d now like to turn the conference over to Joanne Fairechio. Please go ahead.

Thank you, Keith. Welcome to New Jersey Resources' first quarter fiscal 2017 conference call and webcast. I’m joined here today by Larry Downes our Chairman and CEO; Pat Migliaccio our Chief Financial Officer as well as other members of our senior management team. As you know 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 believes forming the basis for our forward-looking statements include many factors that are beyond our ability to control or estimate precisely, which could cause results to materially differ from our expectations. A list of these items can be found in the forward-looking statements section of today news release furnished on Form 8-K and in our most recent Form 10-Q and Form 10-K filed with the SEC. These fillings can be found at www.sec.gov. We do not by including these statements assume any obligation to review or revise any particular forward-looking statements referenced herein in light of future events. I would also like to point out that the slides accompany today’s discussion are available on our website and were furnished on our Form 8-K filed this morning. With that said, I’ll turn the call over to our Chairman and CEO, Larry Downes.

Thanks Joanne and good morning everyone and thank you for joining us today. Before I begin I want to remind you that during our presentation Pat and I will be discussing our future and we’ll be making forward-looking statements. Our actual results may be affected by many different risk factors including those that we’ve listed on slide two. The complete list is included in our 10-K and as always I would encourage you to review them carefully. As noted on slide three, we’ll be referring to certain non-GAAP financial measures such as net financial earnings which we’ll refer to as NFE. We believe that NFE provides more complete understanding of our financial performance, however I want to stress, that NFE is not intended to be a substitute for GAAP. Our non-GAAP financial measures are discussed more fully in Item 7 of our 10-K, and I would encourage you to please take the time to review that disclosure carefully as well. Moving to slide four, for those of you who have seen our announcement this morning, you know that we are performing in line with our original expectations and importantly we reaffirmed our net financial earnings guidance of a range $1.65 to $1.75 per share for fiscal 2017. Our expectation for fiscal 2017 is that New Jersey Natural Gas will continue to provide the majority of our earnings and JNG will have a strong year due to margin from customer growth, as well as new higher base rates. We will also continue to invest in Midstream projects, such as the PennEast pipeline and we expect that Midstream will contribute between 5% and 10% of NFE this year, combined New Jersey Natural Gas and NJR Midstream are currently expected to contribute about 60% to 75% of our total NFE in fiscal 2017. In addition through NJR Clean Energy ventures, we will invest strategically in residential and commercial solar and onshore wind projects. Our expectation is that NJRCEV will contribute between 15% and 25% of fiscal 2017 NFE. NJR Energy Services is performing within our guidance range and is expected to contribute between 5% and 15% of fiscal 2017 NFE, and our annual dividend rate goal remains 6% to 8% with a targeted payout ratio of 60% to 65%. Now I am going to ask Pat, to review our results for the first quarter of fiscal 2017. Pat?

Thanks, Larry and good morning everyone. As Larry indicated, this morning we reported first quarter net financial earnings of $40.4 million, or $0.47 per share versus $51.3 million or $0.60 per share for the same period last year. If you had to breakdown by company, on slide five, our results are consistent with our expectations and we remain confident, we will achieve our earnings guidance for the fiscal year. I’ll now explain our performance this quarter, as well as the factors that support our confidence that we’ll achieve our financial goals for the year. Slide six, illustrates the changes in our NFE year-over-year. As you can see, the biggest change occurred in NJRES, we saw our net financial earnings declined by $6.5 million. To put that in the context though, it is important to understand that the first fiscal quarter of 2016 was the second fastest first fiscal quarter in NJRES’s 20 year history. So the decline in NFE from NJRES is consistent with our expectations. The quarter’s results were also influenced by weather that was slightly warmer than historic averages. The amount of tax credits that we recognized in a given quarter is influenced by both the expectation of projects that we will place in service for the year, as well as the income generates for that same quarter. Our lower quarterly income resulted in recognizing lower tax credits of approximately $2.5 million during the same period last year. Additionally we sold approximately 10,000 fewer SREC this quarter than in the first fiscal quarter of 2016. Our utility gross margin was higher than the prior year’s quarter by approximately $8 million NFE were down modestly over last year. This was due primarily to lower BGSS incentive margin and higher operating and maintenance expenses, which offset the increases in utility…

Thanks Pat what I’d like to do now is to put our performance into a strategic context. So if you turn to slide 11 you can see that we have built our growth strategy in our capital allocation on the ongoing transition on our nation's energy landscape. As we all know this new energy environment is the result of the abundant natural gas supplies in the Marcellus and Utica fields, as well as new sources across the country that have been made possible through advances in drilling technology. We are focused on three strategic areas, natural gas, energy efficiency and clean energy that will provide both essential support to the economic environment well-being our communities and our customers as well as investment opportunities to create long-term value for our shareowners. First, demand for natural gas which is supported by abundant supply is driving new opportunities for us to grow our customer base and invest in infrastructure. Second our focus on energy efficiency enables us to encourage customer savings and pursue growth opportunities that will benefit our shareowners. And finally, clean energy support state and federal energy policy goals that will play an increasing role in meeting the nation's growing energy needs and it will also create new investment opportunities for New Jersey Resources. If you move to slide 12, you can see that natural gas is the foundation of our business and anchors our portfolio. The core strength of New Jersey Natural Gas Company’s service territory support a strong and growing market that is largely residential. Specifically Ocean County is one of the fastest growing counties in our state, which is providing a solid opportunity to invest new capital to add new customers and create long-term value. In addition our infrastructure programs are enhancing safety and reliability for our customs,…

Good morning, guys.

Good morning, Shah.

Can you just elaborate a little bit more on the level of confidence in your 2017 outlook, because obviously weather doesn't appear to be a lot of help this quarter either is it sort of you envisioning the sort of the energy services segment, the timing of some of these hedges to offset if you get another quarter weak results?

Shah, before we begin there I do just want to point out one correction here. In his remarks, Larry had mentioned that the FERC delay for VIS decision over six months in fact it’s actually six weeks. We just wanted to have that on the record. But to answer your question, specifically if you look at the bridge we provided as the companion to the earnings release this morning, the majority of the increase from the prior year’s results are New Jersey Natural Gas. And so, as you know. as most people know the 6 degree weather that we are having today which certainly is not a tailwind for NJR Energy Services, we still expect them to formal in the guidance range and the majority of earnings this year are coming from New Jersey Natural Gas. So we are confident in that ability to achieve the earnings guidance range.

Shah it’s Larry, I’d just add to that that's why we spend some time on the call and in the press release talking about how the margin is actually realize the New Jersey Natural Gas to give you a sense of power layout for whole year and that portion of our performance is really underscoring the confidence we have in meeting the guidance range this year.

Got it, thanks for reinforcing that. And then only just touch on sort of our tax comments, depending on what scenario we turnout with on the corporate taxes curious that sort of a gas utility you sort of building in a scenario where the higher deferred tax liabilities as a result of the lower corporate taxes, which sort of going to be paid off over the life of an asset, the life of the assets or is there do you envision an opportunity where you can finance some of that liability with maybe short-term debt and sort of increase your rate base at a quicker point.

Shah, as I mentioned, we expect it’s going to be net neutral for the utility to your point we’d expect lower deferred tax liabilities in a 20% environment than what we would have before. And so therefore longer period of time put those benefits. And in terms of the revaluation from a 35% to say 20% that we expect would be a regulatory liability that would be returned to rate payers over some period of time that is yet to be determined. As you point out there are still a number of variables here, at least based on the latest information we have it looks like tax reform might be in the spring of ‘18. We have Mark Sperduto I don’t know if he has anything to add.

Thanks guys.

Thank, Shah.

Thank you. And the next question comes from Brian Russo with Ladenburg Thalmann.

Hi, good morning.

Good morning, Brian.

Can you just explain why you sold 10,000 less SRECs this past quarter versus the quarter a year ago?

Brain, it’s strictly timing, each one of our delivery schedules for SRECs are negotiated with the counter party that we sell to. So it’s simply a timing issue.

Okay good...

For the full year we expect an additional -- an increase of about 16,000 SRECs over the prior year.

Okay, got it. And it looks like compared to your prior disclosure the current SREC price have increased quite notably. And I’m just wondering is that just a function of what you’ve described in the past just kind of the liquidity side of things?

Brain, as we laid out at November in our Analyst Day, we expected an increase in liquidity as we led into BGS auction which is occurring right now. And that is -- so there is rise in prices is somewhat consistent with our expectations of better liquidity marketplace. I would add that since the Investor Day we sold roughly 80,000 additional energy or 19 SRECs on average price of roughly $188.

Brain it’s Larry. Going into the Investor Day and if we had to bifurcate that the conference we -- it was clear that there was concern on part of investors about going out looking at energy year ‘19. And so that's why we spend time on trying to explain the relationship of the BGS options to potential impact on SREC prices and as the same year for this so that’s exactly what we’ve seen so we try and take advantage of that opportunity now.

Okay, great. And then the projects that you have in the clean energy services subsidiary, I think you mentioned 24.4 megawatts, can you kind of break that down by each quarter that those megawatts will be operational?

The current plan the bulk of those projects would be operational either the third or fourth fiscal quarter of 2017.

Okay. Fiscal 3Q, 4Q.

Yes.

Got it, thank you.

Thanks, Brian.

Thank you. And our next question comes from Sarah Akers with Wells Fargo.

Hey, good morning.

Good morning, Sarah.

Can you update us on the SRL permitting process and any revisions to the end service state there?

No the process is still going on with the department of environmental protection in this as we speak. But I think Sarah, the way to think about that is what happens once that process is over and we think it would take about four months to basically to the bidding and then another roughly 12 months to the construction. So, -- but we're focused right now what’s going on in the [indiscernible].

Okay. And it looks like the CapEx was lower there in ‘17, correct?

That’s right. We still expect that into receipt of fiscal ‘18, but the other item that winning additional DPEs, this Payments Commission Certificate of Filing, we believe that we may have to refile that as well.

Okay. And then is there any impact to your previously -- your previous equity guidance I think it was $50 million for this year does the lower CapEx at NJNG impact that at all?

Naturally that would shift.

It would, okay great thanks a lot.

Thanks Sarah.

Thank you. And the next question comes from Stephen Zambressi with Carlton [ph] Investment Management.

Hi guys thanks for taking my question.

Good morning, Steve.

Just on the earnings spreads that you provided, can you bucket $0.15 of NJRCEV the $0.15 of depreciation O&M in interest, can you bucket those among those three buckets?

It’s about a third a third a third a third Stephen in terms of additional O&M depreciation and interest expense.

Is that O&M and D&A from the wind farms coming on, or is it…

That’s right.

I guess that’s the major driver.

Yes, the major driver there is the both planned and unplanned maintenance associated with the addition of wind farms.

Okay. All right that’s all I had. Thanks guys.

Thanks Stephen.

Thank you. [Operator Instructions] All right there is nothing more to present at this time. So we'd like to return the call to management for their closing comments.

Okay, thanks Keith. Thank you all for joining us this morning. As a reminder, a recording of this call is available for reply on our website. We appreciate your interest and investment in NJR and enjoy your day. Thank you.

Thank you. The conference is now concluded. Thank you for attending today’s presentation. You may now disconnect.