Hello, and welcome to the New Jersey Resources Fiscal 2023 Third Quarter Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions]. I will now turn the conference over to Mr. Adam Prior of New Jersey Resources. Please go ahead.

Thank you, operator. Welcome to New Jersey Resources fiscal 2023 third quarter conference call and webcast. I'm joined here today by Steve Westhoven, our President and CEO; Roberto Bel, our Senior Vice President and Chief Financial Officer; as well as other members of our senior management team. 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 beliefs forming the basis of our forward-looking statements include many factors that are beyond our ability to control or estimate precisely. This could cause results to materially differ from our expectations as found on Slide 1. These items can also be found in the forward-looking statements section of today's earnings release furnished on Form 8-K and in our most recent Forms 10-K and 10-Q as filed with the SEC. We do not, by including this statement, assume any obligation to review or revise any particular forward-looking statement referenced herein in light of future events. We will also be referring to certain non-GAAP financial measures such as net financial earnings or NFE. We believe that NFE, net financial loss, utility gross margin, financial margin, adjusted funds from operations and adjusted debt provide a more complete understanding of our financial performance. However, these non-GAAP measures are not intended to be a substitute for GAAP. Our non-GAAP financial measures are discussed more fully in Item 7 of our 10-K. The slides accompanying today's presentation are available on our website and were furnished on our Form 8-K filed this morning. Our agenda for today is found on Slide 3. Steve will begin with this quarter's highlights, followed by Roberto, who will review our financial results. Then we'll open it up for your questions. With that said, I will turn the call over to our President and CEO, Steve Westhoven. Please go ahead, Steve.

Thanks, Adam. Good morning, everyone. We had another solid quarter at NJR as our complementary portfolio of businesses continue to perform in line with our expectations. As a result, we remain on track to achieve our fiscal 2023 NFEPS guidance range of $2.62 to $2.72 per share. We reported net financial earnings of $0.10 per share in the third quarter of this year and $2.40 per share year-to-date. To summarize a few highlights. New Jersey Natural Gas added over 1,800 new customers during the quarter, with our growth rate now beginning to return to pre-pandemic levels. In addition, we are proud that New Jersey Natural Gas has been recognized by Escalent as one of their 2023 most trusted utility brands. Clean Energy Ventures continued its strong momentum, increasing its in-service capacity and growing its project pipeline to the highest level in our company's history. At S&T, we reported strong year-over-year revenue growth. And finally, Energy Services improved its NFE year-over-year, driven by continued contribution from the AMA and strong performance from our long option strategy during the quarter. Turning to Slide 5. As I noted earlier, we are reiterating our fiscal 2023 NFEPS guidance range of $2.62 per share to $2.72 per share. Earlier this year, we raised our guidance by $0.20, driven by outperformance in Energy Service during Winter Storm Elliot in December 2022. Our long-term NFEPS growth range remains at 7% to 9% from our original 2022 guidance, and we expect to be at the higher end of that range for fiscal 2024. New Jersey Natural Gas had a strong quarter, as highlighted on Slide 6. We invested $315 million at New Jersey Natural Gas during the first nine months of fiscal 2023, with approximately 40% of that CapEx providing near real-time returns. We've added nearly 5,900 new…

Thank you, Steve, and good morning, everyone. Slide 9 shows the main drivers of our NFE for the third quarter and year-to-date of fiscal 2023. Through the first nine months, we have reported strong year-over-year improvement in our consolidated results with NFE of $232.3 million or $2.40 per share compared with $192.4 million or $2 per share last year. This represents a 20% improvement in our net financial earnings per share for the period. For the third quarter, we reported NFE of $9.7 million or $0.10 per share compared with a net financial loss of $3.6 million or $0.04 per share last year. The quarterly results of our business segments were consistent with our expectations, generally reflecting a year-over-year improvement in margins at NJNG and Energy Services and new revenues at CEV and S&T, offset by higher depreciation and interest expenses. The largest difference compared to Q3 of last year was from the benefit that CEV derived from the successful resolution of an income taxation allowance. This benefit was included in our current NFEPS guidance for the year. Turning to our capital plan on Slide 10. For fiscal year 2023, we're slightly tightening our overall CapEx range, while keeping the midpoint unchanged. At the business unit level, we expect modest CapEx increases at NJNG and S&T, offset by a reduction in the top end of the CEV CapEx range. We'll update our CapEx expectations for fiscal years 2024 and 2025 in our year-end conference call in November. Our capital projections are anchored by strong cash flows from operations. On Slide 11, we show our updated projections for fiscal year 2023. As you can see, we expect operating cash flow to range between $400 million and $420 million. This improvement from our previously stated range is mainly due to higher earnings and a positive impact that lower gas prices had on our working capital requirements. Our credit metric projections for fiscal 2023 have improved in tandem with our operating cash flows, which are shown on Slide 12. We now project NJR's adjusted FFO to adjusted debt, our preferred credit metric, to be between 19% and 20% for the year, while NJNG maintains a favorable investment-grade credit rating. And while we have no plans to issue block equity, our existing dividend reinvestment program includes a waiver discount feature that allows us to raise equity on an opportunistic basis. With that, I will turn the call back to Steve.

Thanks, Roberto. We've been proactive in our discussions with the governor's office concerning the executive orders made public several months ago. This week, the New Jersey BPU is holding a technical conference to discuss the Executive Order 317. We have initiatives in place to align with the state's decarbonization goals and are actively participating in this conference, which is happening in real time. Governor Murphy has made a clear strategy to build a clean energy economy that will drive job growth and create new investment opportunities. A number of the governor's priorities are directly aligned with the strategy that we've been pursuing for more than a decade. In closing, NJR is an energy infrastructure company focused on meeting the needs of our customers while transitioning to a clean energy future. Our capital investments and our efforts to develop organic growth opportunities are supportive of our peer-leading, long-term NFEPS growth targets. As always, I want to thank all of our employees for all their hard work and contribution. And with that, I'll now open the call for questions.

Thank you [Operator Instructions] Your first question comes from the line of Robert Mosca with Mizuho. Your line is open.

Hi, good morning, everyone. So just hoping to get your thoughts on the NJBPU's scratch recommendation on the CSI solicitation process. Was this an outcome you guys expected? And does it change your strategy at all in terms of scoping projects in New Jersey or your overall growth outlook for CEV?

So with any new program, there could be a little bit of a learning curve, and I think the state is going through that learning curve right now. And certainly the state is still very committed to clean energy. So we'll get these programs worked out and look at the projects awarded. The governor certainly has made its commitment to clean energy loud and clear and see. Just turning to how it may impact us. It's not going to. As you know, we've got a large pipeline of projects. 40% of those projects are outside the state. We started to diversify a number of years ago, making investments outside of the city of New Jersey just because the size of the capital program and being able to reliably predict when we'd be able to make those investments was important, and having diversification outside of the state is important to be able to achieve the goals that we've stated. So all-in-all, it doesn't change our strategy. It's still moving forward. We've got a large pipeline of projects, and 40% are outside of the state. But we still feel very confident the state is committed to clean energy and their clean energy goals, and they'll get these programs worked out in the near future.

Thanks. Appreciate it, Steve. And maybe with another quarter of Adelphia operations under your belt, any early indications on whether you can optimize certain segments of the pipe to commit volumes above its existing load? And maybe can we also get your latest thoughts on a potential Leaf River expansion?

So I think it's too soon to say thing about the optimization of Adelphia Gateway. And certainly, we're learning the asset as a new gas pipeline. Remember, the northern portion was natural gas for some time. It has a single-use customer up in the northern portion of it. The southern portion just came in the current operations test law. So still learning that. But I would expect in the future that there would be some optimization associated with it. All along, our target for making these investments throughout our companies for organic growth, being able to grow the assets we have, so certainly, there's an expectation to do that in the future. Nothing to announce on Leaf River. Still working on potential expansion down in that area. Very constructive environment with all the LNG that's being built and the volatility that they're experiencing down in that region. So when we do come to terms on something, we'll certainly make announcement. But again, nothing to announce at this point, but a constructive market down in that region.

Thanks for the time, everyone.

Thanks, Rob.

[Operator Instructions] Your next question comes from the line of Travis Miller with Morningstar. Your line is open.

Good morning, everyone. Thank you.

Hey, Travis.

Just following on that conversation that you're having on the governor's office and all the debate and discussion around the clean energy stuff. What's your thinking in terms of when some of these discussions get into actual regulatory proposals, project proposals, regulatory filings? What's your thought in terms of the time line? Would any of this make it into the next rate case filing? Or is there something beyond that? Does that make sense to kind of timing?

I guess are you talking about the news of the clean energy? Are you talking about the solar solicitation? Or are you talking about some of the regulatory proceedings that are taking place around the executive order to clean energy?

Yeah, more around the clean energy, the latter, yes, not as much the solar stuff, yeah.

So I think with the clean energy, you've got kind of multiple discussions taking place currently. Predicting when those are going to come to conclusion and definitely they would fall into policy and then ultimately into place, I think it's very hard to predict at this point in time. I think it's safe to say there's a lot of discussion that still needs to take place before that would happen. But just as a general comment, we talked about decarbonization, how we're reducing emissions here at NJR, New Jersey Natural Gas. Now we're going to continue forward in this path to be able to deliver cleaner fuels to our customers. Everyone knows about our hydrogen plant, our energy efficiency programs and certainly, our thoughts about the future that we're going to continue to press this forward. So we feel good in this alignment with the governor's stated goals and certainly the state's stated goals as well. But I think when those all will come to basically become part of regulation, I'm predicting at this point in time, but we look forward to it. I think we're going to align nicely with the future goals of the state.

Okay, sure. And remind me again, some of that will make it into the next rate case filing and especially on the hydrogen side. Is that correct?

Well, so our hydrogen plant, remember, was already included and raised in our last rate case, which was they support box state and show that they're supportive of clean energy and clean fuels.

Okay, okay. And then on the solar side, any updates in terms of changes in supply ability to get to buy panels or costs? Anything along those lines?

Yeah, nothing to add there. It's business as usual. And you see that we're bringing projects to completion and putting them into service. 75 megawatts in service this fiscal year. So we're just moving forward and can continue to execute on the plan. So really nothing to talk about there.

Okay. Great. That's all I have. Thanks so much.

Thanks, Travis.

[Operator Instructions] There are no further questions at this time. I will now turn the call back to Mr. Adam Prior for closing remarks.

Thanks, everyone. I would like to thank all of you for joining us this morning. As a reminder, a recording of this call is available for replay on our website. And as always, we appreciate your interest in investing in NJR. Goodbye.

This concludes today's conference call. We thank you for joining. You may now disconnect your lines.