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Press release content from Business Wire. The AP news staff was not involved in its creation.
PRESS RELEASE: Paid content from Business Wire
Press release content from Business Wire. The AP news staff was not involved in its creation.

NW Natural Holdings Reports Third Quarter 2021 Results

November 5, 2021 GMT

PORTLAND, Ore.--(BUSINESS WIRE)--Nov 5, 2021--

Northwest Natural Holding Company, (NYSE: NWN) (NW Natural Holdings), reported financial results and highlights including:

  • Reported a net loss of $0.67 per share for the third quarter of 2021, compared to a net loss of $0.61 per share from continuing operations for the same period in 2020
  • Earned net income of $1.24 per share for the first nine months of 2021 for an increase of $13.7 million or 55%, compared to earnings from continuing operations of $0.80 per share for the same period in 2020
  • Added nearly 12,000 natural gas meters in the last 12 months for a growth rate of 1.5% at Sept. 30, 2021
  • Invested over $200 million in our utility systems in the first nine months of 2021 for greater reliability and resiliency
  • Received Washington rate case order approving a two-year adjustment that combined has an estimated pre-tax earnings benefit of up to $8 million
  • Received approval in Oregon and Washington for new rates related to the Purchased Gas Adjustment (PGA) mechanism, which includes estimated gas costs for the upcoming winter heating season
  • Launched a competitive renewable energy strategy
  • Increased our dividend for the 66 th consecutive year to an annual indicated dividend rate of $1.93 per share
  • Reaffirmed 2021 earnings guidance in the range of $2.40 to $2.60 per share

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“This quarter highlights our commitment to decarbonization, diversification, and growth,” said David H. Anderson, president and CEO of NW Natural Holdings. “We’ve made significant progress toward procuring RNG for our gas utility customers, demonstrating the critical role our system is playing to help move to a low-carbon, renewable energy future. With our new competitive renewables strategy, we’re able to assist a broader group of customers with the energy transition. Our initial partnership and investment represents an exciting first step. I’m proud of our achievements to date and our long-term growth prospects.”

For the third quarter of 2021, the net loss increased $2.0 million to a $20.7 million net loss (or $0.67 per share), compared to a net loss from continuing operations of $18.7 million (or $0.61 per share) for the same period in 2020. The third quarter reflects the seasonal nature of the gas utility’s earnings where the majority of revenues are generated during the winter heating season in the first and fourth quarters each year. Results reflected higher operations and maintenance expenses and higher depreciation and general tax expenses as we continued to invest in our gas utility system, partially offset by customer growth and new rates in Oregon for our natural gas utility.

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Year-to-date net income increased $13.7 million to $38.1 million (or $1.24 per share), compared to $24.5 million (or $0.80 per share) for the same period in 2020. Results reflected customer growth and new rates in Oregon for our natural gas utility, partially offset by higher operations and maintenance expenses, depreciation and general tax expenses. In addition, net income from our other activities increased primarily due to higher asset management revenues.

KEY EVENTS AND INITIATIVES

The after-tax drivers below are based on a statutory tax rate of 26.5%.

Received Order in NW Natural’s Washington General Rate Case

On Dec. 18, 2020, NW Natural filed a request for a general rate increase with the Washington Utilities and Transportation Commission (WUTC). Approximately 10% of NW Natural’s revenues are derived from its Washington customers. The original filing included a requested increase in annual revenue requirements over two years to recover operating costs and infrastructure and technology investments. This included a $6.3 million increase in the first year beginning November 1, 2021 (Year One) and a $3.2 million increase in the second year beginning November 1, 2022 (Year Two).

On Oct. 21, 2021, the WUTC issued an order approving the multi-party settlement in NW Natural’s general rate case. The order increases the revenue requirement $5.0 million in Year One and up to an additional $3.0 million increase in Year Two. The order includes a cost of capital of 6.814% for both years and rate base of $247.3 million as of November 1, 2022 or an increase of $31.2 million for Year 1 and $21.4 million for Year 2. New rates in Washington were effective beginning Nov. 1, 2021.

Coronavirus (COVID-19)

We estimate the financial effects of COVID-19 in the income statement to be $1.7 million (after-tax) for the first nine months of 2021, compared to approximately $1.3 million (after-tax) for the same period in 2020. The 2021 financial effects include $0.7 million (after-tax) of revenue we expect to recognize in a future period related to forgone late fees. The remaining $1.0 million (after-tax) will not be recovered through rates as it primarily relates to lower natural gas distribution margin from customers that stopped natural gas service, partially offset by management cost savings initiatives.

Utility Renewable Natural Gas (RNG)

NW Natural continues to pursue RNG supply for our customers under the landmark Oregon Senate Bill 98, which supports renewable energy procurement and investment by natural gas utilities. NW Natural has options to invest up to a total estimated $38 million in four separate RNG development projects that will access biogas derived from water treatment at Tyson Foods’ processing plants. Construction on our first RNG facility with BioCarbN and Tyson Foods began this fall with completion and commissioning planned for early 2022. To date, NW Natural has signed agreements with options to purchase or develop RNG for utility customers totaling about 2% of NW Natural’s annual sales volume in Oregon.

NW Natural Renewables Launches Competitive RNG Strategy

NW Natural Renewables is a newly formed and non-regulated subsidiary of NW Natural Holdings committed to leading the energy transition and providing renewable fuels to the utility, commercial, industrial and transportation sectors. NW Natural Renewables is focused on providing cost-effective solutions to decarbonize a variety of sectors utilizing existing waste streams and renewable energy resources.

“The renewables business is a natural progression of the insights and capabilities we’ve gained as a leader addressing the energy transition,” said David H. Anderson, NW Natural Holdings president and CEO. “We have strong confidence in the long-term demand for renewable fuels across the country and across various customer classes. This business represents a significant opportunity for us to add earnings and cash flows in a fast-growing market segment.”

NW Natural Renewables’ first project is with EDL, a leading global producer of sustainable distributed energy. We’ve executed agreements to commit $50 million toward the development of two production facilities that are designed to convert landfill waste gases to RNG and connect gas production to existing regional pipeline networks. We’ve also executed agreements with EDL designed to secure a 20-year supply of RNG that NW Natural Renewables intends to market primarily under long-term contracts.

Under the agreements, NW Natural Renewables is committed to investing in RNG infrastructure at two U.S. landfills, which are owned and operated by an industry leader in recycling and non-hazardous solid waste disposal. Construction for these projects is planned to begin in early 2022, with substantial completion and commissioning of the first facility anticipated in early 2023 and the second facility in spring 2023. We expect to fund our investment once commercial operations are achieved for each of the projects.

THIRD QUARTER RESULTS

The following financial comparisons are for the third quarter of 2021 and 2020 with individual year-over-year drivers below presented on an after-tax basis using a statutory tax rate of 26.5% unless otherwise noted.

NW Natural Holdings’ third quarter results are summarized by business segment in the table below:

 

Three Months Ended September 30,

 

2021

 

2020

 

Change

In thousands, except per share data

Amount

 

Per Share

 

Amount

 

Per Share

 

Amount

 

Per Share

Net income (loss) from continuing operations:

 

 

 

 

 

 

 

 

Natural Gas Distribution segment

$

(23,297

)

$

(0.76

)

 

$

(22,120

)

$

(0.72

)

 

$

(1,177

)

$

(0.04

)

Other

2,642

 

0.09

 

 

3,443

 

0.11

 

 

(801

)

(0.02

)

Consolidated

$

(20,655

)

$

(0.67

)

 

$

(18,677

)

$

(0.61

)

 

$

(1,978

)

$

(0.06

)

 

 

 

 

 

 

 

 

 

Diluted Shares

 

30,696

 

 

 

30,555

 

 

 

141

 

Natural Gas Distribution Segment

Natural Gas Distribution segment net loss increased $1.2 million (or $0.04 per share) primarily reflecting higher operations and maintenance and depreciation expenses, partially offset by new rates in Oregon as a result of a general rate case, which was effective beginning Nov. 1, 2020.

Margin increased $4.1 million reflecting new rates in Oregon and customer growth, which collectively contributed $3.7 million.

Operations and maintenance expense increased $3.8 million as a result of higher expenses mainly from contractor and professional service fees for information technology, higher lease expense associated with our new headquarters and operations center, and a comparative benefit related to recording the year-to-date COVID deferral in the third quarter of 2020. Depreciation expense and general taxes increased $1.8 million related to higher property, plant, and equipment as we continue to invest in our system.

YEAR-TO-DATE RESULTS

The following financial comparisons are for the first nine months of 2021 and 2020 with individual year-over-year drivers below presented on an after-tax basis using a statutory tax rate of 26.5% unless otherwise noted.

NW Natural Holdings’ year-to-date results are summarized by business segment in the table below:

 

Nine Months Ended September 30,

 

2021

 

2020

 

Change

In thousands, except per share data

Amount

 

Per Share

 

Amount

 

Per Share

 

Amount

 

Per Share

Net income from continuing operations:

 

 

 

 

 

 

 

 

Natural Gas Distribution segment

$

29,247

 

$

0.95

 

 

$

19,476

 

$

0.64

 

 

$

9,771

 

$

0.31

 

Other

8,891

 

0.29

 

 

4,991

 

0.16

 

 

3,900

 

0.13

 

Consolidated

$

38,138

 

$

1.24

 

 

$

24,467

 

$

0.80

 

 

$

13,671

 

$

0.44

 

 

 

 

 

 

 

 

 

 

Diluted Shares

 

30,708

 

 

 

30,575

 

 

 

133

 

Natural Gas Distribution Segment

Natural Gas Distribution segment net income increased $9.8 million (or $0.31 per share) primarily reflecting new rates in Oregon as a result of a general rate case, which was effective beginning Nov. 1, 2020.

Margin increased $26.2 million reflecting new rates in Oregon and customer growth, which collectively contributed $27.3 million. This was partially offset by a net $1.1 million loss primarily from the gas cost incentive sharing mechanism as a result of purchasing higher priced gas during a February 2021 cold weather event than what was forecasted for the year in part offset by favorable weather.

Operations and maintenance expense increased $8.5 million as a result of higher expenses mainly from increased employee compensation and benefit costs, higher lease expense associated with our new headquarters and operations center, and contractor, professional service fees and license costs related to information technology system upgrades. Depreciation expense and general taxes increased $7.3 million related to higher property, plant, and equipment as we continue to invest in our system.

Other

Other net income increased $3.9 million (or $0.13 per share) reflecting $5.7 million of higher net income from NW Natural’s other activities offset by a loss of $1.8 million from NW Natural Holdings’ other activities. For NW Natural, the benefit in other activities was primarily driven by higher asset management revenues from a February 2021 weather event. NW Natural Holding’s other activities reported higher costs at the holding company.

BALANCE SHEET AND CASH FLOWS

During the first nine months of 2021, the Company generated $181.7 million in operating cash flows or an increase of $30.9 million compared to the same period in 2020 due to higher net income and lower net working capital requirements. The Company used $203.5 million in investing activities during the first nine months of 2021 primarily for natural gas utility capital expenditures, compared to $226.8 million used in investing activities during the same period in 2020 for utility capital expenditures and the acquisition of several water and wastewater utilities. Net cash provided by financing activities was $14.0 million for the first nine months of 2021. As of September 30, 2021, NW Natural Holdings held cash of $19.5 million.

2021 GUIDANCE

NW Natural Holdings reaffirmed 2021 earnings guidance in the range of $2.40 to $2.60 per share. This guidance assumes continued customer growth, average weather conditions, and no significant changes in prevailing regulatory policies, mechanisms, or outcomes, or significant local, state or federal laws, legislation or regulations.

DIVIDEND DECLARED

The Board of Directors of NW Natural Holdings declared a quarterly dividend of $0.4825 per share on the Company’s common stock. The dividend is payable on Nov. 15, 2021 to shareholders of record on Oct. 29, 2021, reflecting an annual indicated dividend rate of $1.93 per share. Future dividends are subject to Board of Director discretion and approval.

CONFERENCE CALL AND WEBCAST

As previously announced, NW Natural Holdings will host a conference call and webcast today to discuss its third quarter 2021 financial and operating results.

Date and Time:

Friday, Nov. 5, 2021

8 a.m. PT (11 a.m. ET)

Phone Numbers:

United States: 1-866-267-6789

Canada: 1-855-669-9657

International: 1-412-902-4110

The call will also be webcast in a listen-only format for the media and general public and can be accessed at ir.nwnaturalholdings.com. A replay of the conference call will be available on our website and by dialing 1-877-344-7529 (U.S.), 1-855-669-9658 (Canada), and 1-412-317-0088 (international). The replay access code is 10154467.

ABOUT NW NATURAL HOLDINGS

Northwest Natural Holding Company, (NYSE: NWN) (NW Natural Holdings), is headquartered in Portland, Oregon and has been doing business for over 160 years in the Pacific Northwest. It owns NW Natural Gas Company (NW Natural), NW Natural Renewables Holdings (NW Natural Renewables), NW Natural Water Company (NW Natural Water), and other business interests. We have a longstanding commitment to safety, environmental stewardship and the energy transition, and taking care of our employees and communities.

NW Natural is a local distribution company that currently provides natural gas service to approximately 2.5 million people in more than 140 communities through more than 780,000 meters in Oregon and Southwest Washington with one of the most modern pipeline systems in the nation. NW Natural consistently leads the industry with high J.D. Power & Associates customer satisfaction scores. NW Natural owns and operates 20 Bcf of underground gas storage capacity in Oregon.

NW Natural Water provides water distribution and wastewater services to communities throughout the Pacific Northwest and Texas. NW Natural Water currently serves approximately 66,000 people through about 27,200 connections. Learn more about our water business at nwnaturalwater.com.

Additional information is available at nwnaturalholdings.com.

Forward-Looking Statements

This report, and other presentations made by NW Holdings from time to time, may contain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “anticipates,” “assumes,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects” and similar references to future periods. Examples of forward-looking statements include, but are not limited to, statements regarding the following: plans, objectives, assumptions, estimates, expectations, timing, goals, strategies, commitments, future events, investments, capital expenditures, targeted capital structure, risks, risk profile, stability, acquisitions and timing, completion and integration thereof, the likelihood and success associated with any transaction, utility system and infrastructure investments, system modernization, reliability and resiliency, global, national and local economies, customer and business growth, customer satisfaction ratings, weather, performance and service during weather events, customer rates or rate recovery and the timing and magnitude of potential rate changes, environmental remediation cost recoveries, environmental initiatives, decarbonization and the role of natural gas and the gas delivery system, including decarbonization goals and timelines, energy efficiency measures, use of renewable sources, renewable natural gas purchases, projects or investments and timing, magnitude and completion thereof, renewable hydrogen projects or investments and timing, magnitude and completion thereof, procurement of renewable natural gas or hydrogen for customers, technology and policy innovations, strategic goals and visions, the water and wastewater acquisition and investment strategy and financial effects of water and wastewater acquisitions, diversity, equity and inclusion initiatives, operating plans of third parties, financial results, including estimated income, availability and sources of liquidity, expenses, positions, revenues, returns, cost of capital, timing, and earnings and earnings guidance, dividends, commodity costs and sourcing asset management activities, performance, timing, outcome, or effects of regulatory proceedings or mechanisms or approvals, regulatory prudence reviews, anticipated regulatory actions or filings, accounting treatment of future events, effects of legislation or changes in laws or regulations, effects, extent, severity and duration of COVID-19 and resulting economic disruption, the impact of mitigating factors and other efforts to mitigate risks posed by its spread, ability of our workforce, customers or suppliers to operate or conduct business, COVID-19 financial impact, expenses, cost savings measures and cost recovery including through regulatory deferrals and the timing and magnitude thereof, impact on capital projects, governmental actions and timing thereof, including actions to reopen the economy, and other statements that are other than statements of historical facts.

Forward-looking statements are based on current expectations and assumptions regarding its business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Actual results may differ materially from those contemplated by the forward-looking statements. You are therefore cautioned against relying on any of these forward-looking statements. They are neither statements of historical fact nor guarantees or assurances of future operational, economic or financial performance. Important factors that could cause actual results to differ materially from those in the forward-looking statements are discussed by reference to the factors described in Part I, Item 1A “Risk Factors”, and Part II, Item 7 and Item 7A “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Quantitative and Qualitative Disclosure about Market Risk” in the most recent Annual Report on Form 10-K and in Part I, Items 2 and 3 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Quantitative and Qualitative Disclosures About Market Risk”, and Part II, Item 1A, “Risk Factors”, in the quarterly reports filed thereafter.

All forward-looking statements made in this report and all subsequent forward-looking statements, whether written or oral and whether made by or on behalf of NW Holdings or NW Natural, are expressly qualified by these cautionary statements. Any forward-looking statement speaks only as of the date on which such statement is made, and NW Holdings and NW Natural undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law. New factors emerge from time to time and it is not possible to predict all such factors, nor can it assess the impact of each such factor or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statements.

NORTHWEST NATURAL HOLDINGS

Consolidated Income Statement and Financial Highlights (Unaudited)

Third Quarter 2021

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

Twelve Months Ended

 

 

In thousands, except per share amounts,

September 30,

 

 

 

September 30,

 

 

 

September 30,

 

 

customer, and degree day data

2021

 

2020

 

Change

 

2021

 

2020

 

Change

 

2021

 

2020

 

Change

Operating revenues

$

101,447

 

 

$

93,284

 

9%

$

566,310

 

 

$

513,406

 

10%

$

826,583

 

 

$

760,670

 

9%

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

Cost of gas

25,266

 

 

23,741

 

6

178,669

 

 

173,489

 

3

267,935

 

 

265,233

 

1

Operations and maintenance

47,329

 

 

41,352

 

14

149,567

 

 

134,256

 

11

195,440

 

 

180,593

 

8

Environmental remediation

806

 

 

867

 

(7)

6,092

 

 

6,494

 

(6)

9,289

 

 

11,573

 

(20)

General taxes

9,061

 

 

8,656

 

5

29,344

 

 

26,924

 

9

37,498

 

 

34,413

 

9

Revenue taxes

3,891

 

 

3,555

 

9

22,226

 

 

19,752

 

13

32,765

 

 

30,121

 

9

Depreciation and amortization

28,438

 

 

25,934

 

10

84,679

 

 

76,445

 

11

111,917

 

 

100,607

 

11

Other operating expenses

1,047

 

 

767

 

37

2,794

 

 

2,246

 

24

4,249

 

 

3,365

 

26

Total operating expenses

115,838

 

 

104,872

 

10

473,371

 

 

439,606

 

8

659,093

 

 

625,905

 

5

Income (loss) from operations

(14,391

)

 

(11,588

)

24

92,939

 

 

73,800

 

26

167,490

 

 

134,765

 

24

Other income (expense), net

(2,216

)

 

(3,287

)

(33)

(8,355

)

 

(9,902

)

(16)

(12,397

)

 

(13,956

)

(11)

Interest expense, net

11,175

 

 

9,165

 

22

33,329

 

 

32,339

 

3

44,042

 

 

43,217

 

2

Income (loss) before income taxes

(27,782

)

 

(24,040

)

16

51,255

 

 

31,559

 

62

111,051

 

 

77,592

 

43

Income tax expense (benefit)

(7,127

)

 

(5,363

)

33

13,117

 

 

7,092

 

85

27,107

 

 

14,777

 

83

Net income (loss) from continuing operations

(20,655

)

 

(18,677

)

11

38,138

 

 

24,467

 

56

83,944

 

 

62,815

 

34

Income (loss) from discontinued operations, net of tax

 

 

765

 

(100)

 

 

267

 

(100)

6,241

 

 

(1,341

)

(565)

Net income (loss)

$

(20,655

)

 

$

(17,912

)

15

$

38,138

 

 

$

24,734

 

54

$

90,185

 

 

$

61,474

 

47

 

 

 

 

 

 

 

 

 

 

 

 

 

Common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

Average diluted for period

30,696

 

 

30,555

 

 

30,708

 

 

30,575

 

 

30,676

 

 

30,551

 

 

End of period

30,730

 

 

30,565

 

 

30,730

 

 

30,565

 

 

30,730

 

 

30,565

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per share of common stock information:

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings (loss) from continuing operations

$

(0.67

)

 

$

(0.61

)

 

$

1.24

 

 

$

0.80

 

 

$

2.74

 

 

$

2.06

 

 

Diluted earnings (loss) from discontinued operations, net of tax

 

 

0.02

 

 

 

 

0.01

 

 

0.20

 

 

(0.05

)

 

Diluted earnings (loss)

(0.67

)

 

(0.59

)

 

1.24

 

 

0.81

 

 

2.94

 

 

2.01

 

 

Dividends paid per share

0.4800

 

 

0.4775

 

 

1.4400

 

 

1.4325

 

 

1.9200

 

 

1.9100

 

 

Book value, end of period

29.01

 

 

27.90

 

 

29.01

 

 

27.90

 

 

29.01

 

 

27.90

 

 

Market closing price, end of period

45.99

 

 

45.39

 

 

45.99

 

 

45.39

 

 

45.99

 

 

45.39

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital structure, end of period:

 

 

 

 

 

 

 

 

 

 

 

 

Common stock equity

40.4

%

 

42.0

%

 

40.4

%

 

42.0

%

 

40.4

%

 

42.0

%

 

Long-term debt

41.5

%

 

42.3

%

 

41.5

%

 

42.3

%

 

41.5

%

 

42.3

%

 

Short-term debt (including current maturities of long-term debt)

18.1

%

 

15.7

%

 

18.1

%

 

15.7

%

 

18.1

%

 

15.7

%

 

Total

100.0

%

 

100.0

%

 

100.0

%

 

100.0

%

 

100.0

%

 

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Natural Gas Distribution segment operating statistics:

 

 

 

 

 

 

 

 

 

 

 

 

Meters - end of period

781,727

 

 

769,817

 

1.5%

781,727

 

 

769,817

 

1.5%

781,727

 

 

769,817

 

1.5%

Volumes in therms:

 

 

 

 

 

 

 

 

 

 

 

 

Residential and commercial sales

55,597

 

 

54,124

 

 

455,888

 

 

440,811

 

 

692,348

 

 

694,171

 

 

Industrial sales and transportation

105,632

 

 

100,312

 

 

350,175

 

 

341,755

 

 

474,046

 

 

473,741

 

 

Total volumes sold and delivered

161,229

 

 

154,436

 

 

806,063

 

 

782,566

 

 

1,166,394

 

 

1,167,912

 

 

Operating revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Residential and commercial sales

$

71,979

 

 

$

66,384

 

 

$

470,923

 

 

$

431,187

 

 

$

701,082

 

 

$

650,569

 

 

Industrial sales and transportation

14,000

 

 

12,334

 

 

45,472

 

 

42,195

 

 

61,955

 

 

58,237

 

 

Other distribution revenues

292

 

 

639

 

 

1,278

 

 

1,607

 

 

1,597

 

 

1,964

 

 

Other regulated services

4,771

 

 

4,404

 

 

14,321

 

 

14,251

 

 

19,192

 

 

18,910

 

 

Total operating revenues

91,042

 

 

83,761

 

 

531,994

 

 

489,240

 

 

783,826

 

 

729,680

 

 

Less: Cost of gas

25,322

 

 

23,797

 

 

178,837

 

 

173,657

 

 

268,160

 

 

265,457

 

 

Less: Environmental remediation expense

806

 

 

867

 

 

6,092

 

 

6,494

 

 

9,289

 

 

11,573

 

 

Less: Revenue taxes

3,838

 

 

3,555

 

 

22,143

 

 

19,752

 

 

32,682

 

 

30,121

 

 

Margin, net

$

61,076

 

 

$

55,542

 

 

$

324,922

 

 

$

289,337

 

 

$

473,695

 

 

$

422,529

 

 

Degree days:

 

 

 

 

 

 

 

 

 

 

 

 

Average (25-year average)

9

 

 

9

 

 

1,640

 

 

1,659

 

 

2,687

 

 

2,723

 

 

Actual

4

 

 

2

 

100%

1,447

 

 

1,406

 

3%

2,425

 

 

2,477

 

(2)%

Percent colder (warmer) than average weather

(56

)%

 

(78

)%

 

(12

)%

 

(15

)%

 

(10

)%

 

(9

)%

 

NORTHWEST NATURAL HOLDINGS

 

 

 

 

Consolidated Balance Sheets (Unaudited)

 

September 30,

In thousands

 

2021

 

2020

Assets:

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

19,502

 

 

$

35,926

 

Accounts receivable

 

39,209

 

 

40,278

 

Accrued unbilled revenue

 

16,809

 

 

14,787

 

Allowance for uncollectible accounts

 

(2,702

)

 

(1,786

)

Regulatory assets

 

80,638

 

 

29,740

 

Derivative instruments

 

105,175

 

 

24,094

 

Inventories

 

59,997

 

 

45,082

 

Gas reserves

 

6,266

 

 

12,265

 

Other current assets

 

33,285

 

 

25,534

 

Discontinued operations current assets

 

 

 

16,928

 

Total current assets

 

358,179

 

 

242,848

 

Non-current assets:

 

 

 

 

Property, plant, and equipment

 

3,919,096

 

 

3,680,872

 

Less: Accumulated depreciation

 

1,112,734

 

 

1,073,623

 

Total property, plant, and equipment, net

 

2,806,362

 

 

2,607,249

 

Gas reserves

 

28,021

 

 

37,696

 

Regulatory assets

 

325,071

 

 

324,176

 

Derivative instruments

 

24,555

 

 

12,921

 

Other investments

 

48,006

 

 

48,963

 

Operating lease right of use asset, net

 

75,634

 

 

78,036

 

Assets under sales-type leases

 

140,189

 

 

144,971

 

Goodwill

 

69,789

 

 

70,292

 

Other non-current assets

 

53,419

 

 

50,945

 

Total non-current assets

 

3,571,046

 

 

3,375,249

 

Total assets

 

$

3,929,225

 

 

$

3,618,097

 

Liabilities and equity:

 

 

 

 

Current liabilities:

 

 

 

 

Short-term debt

 

$

399,500

 

 

$

223,000

 

Current maturities of long-term debt

 

278

 

 

95,173

 

Accounts payable

 

94,897

 

 

83,813

 

Taxes accrued

 

16,558

 

 

13,772

 

Interest accrued

 

9,315

 

 

9,645

 

Regulatory liabilities

 

164,168

 

 

59,236

 

Derivative instruments

 

9,818

 

 

1,784

 

Operating lease liabilities

 

1,213

 

 

1,081

 

Other current liabilities

 

39,218

 

 

49,870

 

Discontinued operations current liabilities

 

 

 

13,922

 

Total current liabilities

 

734,965

 

 

551,296

 

Long-term debt

 

916,026

 

 

860,235

 

Deferred credits and other non-current liabilities:

 

 

 

 

Deferred tax liabilities

 

323,925

 

 

296,516

 

Regulatory liabilities

 

665,390

 

 

649,521

 

Pension and other postretirement benefit liabilities

 

202,287

 

 

202,938

 

Derivative instruments

 

268

 

 

921

 

Operating lease liabilities

 

79,789

 

 

80,854

 

Other non-current liabilities

 

115,114

 

 

123,041

 

Total deferred credits and other non-current liabilities

 

1,386,773

 

 

1,353,791

 

Equity:

 

 

 

 

Common stock

 

573,578

 

 

563,852

 

Retained earnings

 

330,109

 

 

299,150

 

Accumulated other comprehensive loss

 

(12,226

)

 

(10,227

)

Total equity

 

891,461

 

 

852,775

 

Total liabilities and equity

 

$

3,929,225

 

 

$

3,618,097

 

NORTHWEST NATURAL HOLDINGS

 

 

 

 

Consolidated Statements of Cash Flows (Unaudited)

 

Nine Months Ended September 30,

In thousands

 

2021

 

2020

Operating activities:

 

 

 

 

Net income

 

$

38,138

 

 

$

24,734

 

Adjustments to reconcile net income to cash provided by operations:

 

 

 

 

Depreciation and amortization

 

84,679

 

 

76,445

 

Regulatory amortization of gas reserves

 

11,606

 

 

13,711

 

Deferred income taxes

 

2,748

 

 

(390

)

Qualified defined benefit pension plan expense

 

12,075

 

 

13,800

 

Contributions to qualified defined benefit pension plans

 

(9,590

)

 

(23,670

)

Deferred environmental expenditures, net

 

(14,952

)

 

(16,469

)

Amortization of environmental remediation

 

6,092

 

 

6,494

 

Other

 

5,815

 

 

(4,483

)

Changes in assets and liabilities:

 

 

 

 

Receivables, net

 

83,826

 

 

77,236

 

Inventories

 

(17,307

)

 

(1,126

)

Income and other taxes

 

19,620

 

 

12,038

 

Accounts payable

 

(18,057

)

 

(20,311

)

Deferred gas costs

 

(33,379

)

 

(2,472

)

Asset optimization revenue sharing

 

41,407

 

 

(9,695

)

Decoupling mechanism

 

(9,172

)

 

4,175

 

Other, net

 

(21,825

)

 

74

 

Discontinued operations

 

 

 

706

 

Cash provided by operating activities

 

181,724

 

 

150,797

 

Investing activities:

 

 

 

 

Capital expenditures

 

(212,376

)

 

(193,336

)

Acquisitions, net of cash acquired

 

(375

)

 

(38,078

)

Leasehold improvement expenditures

 

(570

)

 

(7,827

)

Proceeds from the sale of assets

 

2,712

 

 

8,003

 

Proceeds from sale of equity method investment

 

7,000

 

 

7,000

 

Other

 

88

 

 

(240

)

Discontinued operations

 

 

 

(2,287

)

Cash used in investing activities

 

(203,521

)

 

(226,765

)

Financing activities:

 

 

 

 

Proceeds from common stock issued, net

 

2,107

 

 

68

 

Long-term debt issued

 

55,000

 

 

150,000

 

Long-term debt retired

 

(95,000

)

 

(75,000

)

Proceeds from term loan due within one year

 

100,000

 

 

150,000

 

Repayments of commercial paper, maturities greater than three months

 

(195,025

)

 

 

Change in other short-term debt, net

 

190,000

 

 

(76,100

)

Cash dividend payments on common stock

 

(41,827

)

 

(41,508

)

Other

 

(1,240

)

 

(2,957

)

Cash provided by financing activities

 

14,015

 

 

104,503

 

Increase (decrease) in cash, cash equivalents and restricted cash

 

(7,782

)

 

28,535

 

Cash, cash equivalents and restricted cash, beginning of period

 

35,454

 

 

12,636

 

Cash, cash equivalents and restricted cash, end of period

 

$

27,672

 

 

$

41,171

 

 

 

 

 

 

Supplemental disclosure of cash flow information:

 

 

 

 

Interest paid, net of capitalization

 

$

30,910

 

 

$

29,829

 

Income taxes paid, net of refunds

 

6,980

 

 

9,344

 

 

 

 

 

 

Reconciliation of cash, cash equivalents and restricted cash:

 

 

 

 

Cash and cash equivalents

 

$

19,502

 

 

$

35,926

 

Restricted cash included in other current assets

 

8,170

 

 

5,245

 

Cash, cash equivalents and restricted cash

 

$

27,672

 

 

$

41,171

 

 

View source version on businesswire.com:https://www.businesswire.com/news/home/20211105005254/en/

CONTACT: Investor Contact:

Nikki Sparley

Phone: 503-721-2530

Email:nikki.sparley@nwnatural.comMedia Contact:

David Roy

Phone: 503-610-7157

Email:david.roy@nwnatural.com

KEYWORD: OREGON UNITED STATES NORTH AMERICA

INDUSTRY KEYWORD: ALTERNATIVE ENERGY ENERGY UTILITIES OIL/GAS

SOURCE: NW Natural

Copyright Business Wire 2021.

PUB: 11/05/2021 06:00 AM/DISC: 11/05/2021 06:01 AM

http://www.businesswire.com/news/home/20211105005254/en