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FOR THE TRANSITION PERIOD FROM TO
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Commission file number 001‑08359
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NEW JERSEY RESOURCES CORPORATION
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(Exact name of registrant as specified in its charter)
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New Jersey
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22‑2376465
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification Number)
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1415 Wyckoff Road, Wall, New Jersey 07719
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732‑938‑1480
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(Address of principal
executive offices)
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(Registrant’s telephone number,
including area code) |
Securities registered pursuant to Section 12 (b) of the Act:
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Common Stock ‑ $2.50 Par Value
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New York Stock Exchange
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(Title of each class)
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(Name of each exchange on which registered)
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Securities registered pursuant to Section 12 (g) of the Act:
None
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Large accelerated filer:
x
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Accelerated filer:
o
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Non-accelerated filer:
o
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(Do not check if a smaller reporting company)
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Smaller reporting company
:
o
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Emerging growth company
:
o
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Page
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PART I
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ITEM 1.
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ITEM 1A.
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ITEM 1B.
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ITEM 2.
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ITEM 3.
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ITEM 4.
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ITEM 4A.
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PART II
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ITEM 5.
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ITEM 6.
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ITEM 7.
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ITEM 7A.
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ITEM 8.
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ITEM 9.
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ITEM 9A.
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ITEM 9B.
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PART III*
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ITEM 10.
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ITEM 11.
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ITEM 12.
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ITEM 13.
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ITEM 14.
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PART IV
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ITEM 15.
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* Portions of Item 10 and Items 11-14 are Incorporated by Reference from the Proxy Statement.
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Adelphia
|
Adelphia Gateway, LLC
|
AFUDC
|
Allowance for Funds Used During Construction
|
AOCI
|
Accumulated Other Comprehensive Income
|
ARO
|
Asset Retirement Obligations
|
ASC
|
Accounting Standards Codification
|
ASU
|
Accounting Standards Update
|
Bcf
|
Billion Cubic Feet
|
BGSS
|
Basic Gas Supply Service
|
BPU
|
New Jersey Board of Public Utilities
|
CIP
|
Conservation Incentive Program
|
CME
|
Chicago Mercantile Exchange
|
CR&R
|
Commercial Realty & Resources Corp.
|
Degree-Day
|
The measure of the variation in the weather based on the extent to which the average daily temperature falls below 65 degrees Fahrenheit
|
DM
|
Dominion Midstream Partners, L.P., a master limited partnership
|
DM Common Units
|
Common units representing limited partnership interests in DM
|
Dodd-Frank Act
|
Dodd-Frank Wall Street Reform and Consumer Protection Act
|
DRP
|
NJR Direct Stock Purchase and Dividend Reinvestment Plan
|
Dths
|
Dekatherms
|
EDA
|
New Jersey Economic Development Authority
|
EDA Bonds
|
Collectively, Series 2011A, Series 2011B and Series 2011C Bonds issued to NJNG by the EDA
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EDECA
|
Electric Discount and Energy Competition Act
|
EE
|
Energy Efficiency
|
FASB
|
Financial Accounting Standards Board
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FCM
|
Futures Commission Merchant
|
FERC
|
Federal Energy Regulatory Commission
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Financial Margin
|
A non-GAAP financial measure, which represents revenues earned from the sale of natural gas less costs of natural gas sold including any transportation and storage costs, and excludes any accounting impact from the change in the fair value of certain derivative instruments
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FMB
|
First Mortgage Bonds
|
FRM
|
Financial Risk Management
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GAAP
|
Generally Accepted Accounting Principles of the United States
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HCCTR
|
Health Care Cost Trend Rate
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Home Services and Other
|
Home Services and Other Operations (formerly Retail and Other Operations)
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ICE
|
Intercontinental Exchange
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IEC
|
Interstate Energy Company, LLC
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Iroquois
|
Iroquois Gas Transmission L.P.
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IRS
|
Internal Revenue Service
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ISDA
|
The International Swaps and Derivatives Association
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ITC
|
Investment Tax Credit
|
LIBOR
|
London Inter-Bank Offered Rate
|
LNG
|
Liquefied Natural Gas
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Loan Agreement
|
Loan Agreement between the EDA and NJNG
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MetLife
|
Metropolitan Life Insurance Company
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MetLife Facility
|
NJR’s unsecured, uncommitted $100 million private placement shelf note agreement with MetLife, Inc., which expired in September 2016
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MGP
|
Manufactured Gas Plant
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MLP
|
Master limited partnership
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Moody’s
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Moody’s Investors Service, Inc.
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Mortgage Indenture
|
The Amended and Restated Indenture of Mortgage, Deed of Trust and Security Agreement between NJNG and U.S. Bank National Association dated as of September 1, 2014
|
MW
|
Megawatts
|
MWh
|
Megawatt Hour
|
NAESB
|
The North American Energy Standards Board
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NFE
|
Net Financial Earnings
|
NGV
|
Natural Gas Vehicles
|
GLOSSARY OF KEY TERMS (cont.)
|
|
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NJ RISE
|
New Jersey Reinvestment in System Enhancement
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NJCEP
|
New Jersey’s Clean Energy Program
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NJDEP
|
New Jersey Department of Environmental Protection
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NJNG
|
New Jersey Natural Gas Company or Natural Gas Distribution segment
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NJNG Credit Facility
|
The $250 million unsecured committed credit facility expiring in May 2019
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NJR Credit Facility
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NJR’s $425 million unsecured committed credit facility expiring in September 2020
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NJR Energy
|
NJR Energy Corporation
|
NJR or The Company
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New Jersey Resources Corporation
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NJRCEV
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NJR Clean Energy Ventures Corporation
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NJRES
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NJR Energy Services Company
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NJRHS
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NJR Home Services Company
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NJRPS
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NJR Plumbing Services, Inc.
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NJRRS
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NJR Retail Services Company
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NJR Retail Holdings
|
NJR Retail Holdings Corporation
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Non-GAAP
|
Not in accordance with Generally Accepted Accounting Principles of the United States
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NPNS
|
Normal Purchase/Normal Sale
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NYMEX
|
New York Mercantile Exchange
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O&M
|
Operation and Maintenance
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OCI
|
Other Comprehensive Income
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OPEB
|
Other Postemployment Benefit Plans
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PBO
|
Projected Benefit Obligation
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PennEast
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PennEast Pipeline Company, LLC
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PEP
|
Pension Equalization Plan
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PIM
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Pipeline Integrity Management
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PPA
|
Power Purchase Agreement
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Prudential
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Prudential Investment Management, Inc.
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Prudential Facility
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NJR’s unsecured, uncommitted private placement shelf note agreement with Prudential
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PTC
|
Production Tax Credit
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RAC
|
Remediation Adjustment Clause
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REC
|
Renewable Energy Certificate
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S&P
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Standard & Poor’s Financial Services, LLC
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SAFE
|
Safety Acceleration and Facility Enhancement
|
Sarbanes-Oxley
|
Sarbanes-Oxley Act of 2002
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SAVEGREEN
|
The SAVEGREEN Project®
|
Savings Plan
|
Employees’ Retirement Savings Plan
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SBC
|
Societal Benefits Charge
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SEC
|
Securities and Exchange Commission
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SREC
|
Solar Renewable Energy Certificate
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SRL
|
Southern Reliability Link
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Steckman Ridge
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Collectively, Steckman Ridge GP, LLC and Steckman Ridge, LP
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Superstorm Sandy
|
Post-Tropical Cyclone Sandy
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Talen
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Talen Energy Marketing, LLC or Talen Generation, LLC
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Tetco
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Texas Eastern Transmission
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The Exchange Act
|
The Securities Exchange Act of 1934, as amended
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Trustee
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U.S. Bank National Association
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TSR
|
Total Shareholder Return
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U.S.
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The United States of America
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Union
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International Brotherhood of Electrical Workers Local 1820
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USF
|
Universal Service Fund
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•
|
risks associated with our investments in clean energy projects,
including the availability of regulatory and tax incentives, the availability of viable projects, our eligibility for ITCs and PTCs, the future market for SRECs and electricity prices, and operational risks related to projects in service;
|
•
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our ability to obtain governmental and regulatory approvals, land-use rights, electric grid connection (in the case of clean energy projects) and/or financing for the construction, development and operation of our unregulated energy investments and NJNG
’
s infrastructure projects in a timely manner;
|
•
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risks associated with acquisitions and the related integration of acquired assets with our current operations;
|
•
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volatility of natural gas and other commodity prices and their impact on NJNG customer usage, NJNG
’
s
BGSS
incentive programs, our Energy Services segment operations and on our risk management efforts;
|
•
|
the level and rate at which NJNG
’
s costs and expenses are incurred and the extent to which they are approved for recovery from customers through the regulatory process, including through future base rate case filings;
|
•
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the impact of a disallowance of recovery of environmental-related expenditures and other regulatory changes;
|
•
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the performance of our subsidiaries;
|
•
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operating risks incidental to handling, storing, transporting and providing customers with natural gas;
|
•
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access to adequate supplies of natural gas and dependence on third-party storage and transportation facilities for natural gas supply;
|
•
|
the regulatory and pricing policies of federal and state regulatory agencies;
|
•
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timing of qualifying for ITCs and PTCs due to delays or failures to complete planned solar and wind energy projects and the resulting effect on our effective tax rate and earnings;
|
•
|
the results of legal or administrative proceedings with respect to claims, rates, environmental issues, gas cost prudence reviews and other matters;
|
•
|
risks related to cyberattacks or failure of information technology systems;
|
•
|
changes in rating agency requirements and/or credit ratings and their effect on availability and cost of capital to our Company;
|
•
|
our ability to comply with current and future regulatory requirements;
|
•
|
the impact of volatility in the equity and credit markets on our access to capital;
|
•
|
the impact to the asset values and resulting higher costs and funding obligations of our pension and postemployment benefit plans as a result of potential downturns in the financial markets, lower discount rates, revised actuarial assumptions or impacts associated with the Patient Protection and Affordable Care Act;
|
•
|
commercial and wholesale credit risks, including the availability of creditworthy customers and counterparties, and liquidity in the wholesale energy trading market;
|
•
|
accounting effects and other risks associated with hedging activities and use of derivatives contracts;
|
•
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our ability to optimize our physical assets;
|
•
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any potential need to record a valuation allowance for our deferred tax assets;
|
•
|
changes to tax laws and regulations;
|
•
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weather and economic conditions;
|
•
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our ability to comply with debt covenants;
|
•
|
demographic changes in NJR
’s
service territory and their effect on NJR
’s
customer growth;
|
•
|
the impact of natural disasters, terrorist activities and other extreme events on our operations and customers;
|
•
|
the costs of compliance with present and future environmental laws, including potential climate change-related legislation;
|
•
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environmental-related and other uncertainties related to litigation or administrative proceedings;
|
•
|
risks related to our employee workforce; and
|
•
|
risks associated with the management of our joint ventures and partnerships, and investment in a master limited partnership.
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(Thousands)
|
2017
|
2016
|
2015
|
||||||
Net income
|
$
|
132,065
|
|
$
|
131,672
|
|
$
|
180,960
|
|
Add:
|
|
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||||||
Unrealized (gain) loss on derivative instruments and related transactions
|
(11,241
|
)
|
46,883
|
|
(38,681
|
)
|
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Tax effect
|
4,062
|
|
(17,018
|
)
|
14,391
|
|
|||
Effects of economic hedging related to natural gas inventory
|
38,470
|
|
(36,816
|
)
|
(8,225
|
)
|
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Tax effect
|
(13,964
|
)
|
13,364
|
|
3,058
|
|
|||
NFE
|
$
|
149,392
|
|
$
|
138,085
|
|
$
|
151,503
|
|
Basic earnings per share
|
$
|
1.53
|
|
$
|
1.53
|
|
$
|
2.12
|
|
Add:
|
|
|
|
||||||
Unrealized (gain) loss on derivative instruments and related transactions
|
(0.13
|
)
|
0.55
|
|
(0.45
|
)
|
|||
Tax effect
|
0.05
|
|
(0.20
|
)
|
0.17
|
|
|||
Effects of economic hedging related to natural gas inventory
|
0.45
|
|
(0.43
|
)
|
(0.10
|
)
|
|||
Tax effect
|
(0.17
|
)
|
0.16
|
|
0.04
|
|
|||
Basic NFE per share
|
$
|
1.73
|
|
$
|
1.61
|
|
$
|
1.78
|
|
|
2017
|
|
2016
|
|
2015
|
||||||||||||
($ in thousands)
|
Operating Revenue
|
Bcf
|
|
Operating Revenue
|
Bcf
|
|
Operating Revenue
|
Bcf
|
|||||||||
Residential
|
$
|
395,315
|
|
40.7
|
|
|
$
|
345,597
|
|
36.9
|
|
|
$
|
466,464
|
|
45.9
|
|
Commercial and other
|
98,777
|
|
8.7
|
|
|
80,994
|
|
7.3
|
|
|
106,505
|
|
9.6
|
|
|||
Firm transportation
|
73,206
|
|
14.4
|
|
|
69,696
|
|
14.1
|
|
|
77,974
|
|
16.0
|
|
|||
Total residential and commercial
|
567,298
|
|
63.8
|
|
|
496,287
|
|
58.3
|
|
|
650,943
|
|
71.5
|
|
|||
Interruptible
|
7,970
|
|
55.0
|
|
|
8,867
|
|
61.5
|
|
|
10,049
|
|
47.1
|
|
|||
Total system
|
575,268
|
|
118.8
|
|
|
505,154
|
|
119.8
|
|
|
660,992
|
|
118.6
|
|
|||
BGSS incentive programs
(1)
|
120,369
|
|
49.5
|
|
|
89,192
|
|
56.6
|
|
|
120,978
|
|
47.8
|
|
|||
Total
|
$
|
695,637
|
|
168.3
|
|
|
$
|
594,346
|
|
176.4
|
|
|
$
|
781,970
|
|
166.4
|
|
(1)
|
Does not include
128.9
,
160.1
and
174.6
Bcf for the capacity release program and related amounts of
$6.5 million
,
$8.1 million
and
$8.9 million
, which are recorded as a reduction of gas purchases on the Consolidated Statements of Operations for the fiscal years ended
September 30, 2017
,
2016
and
2015
, respectively.
|
Pipeline
|
Dths
(1)
|
Expiration
|
||
Texas Eastern Transmission, L.P.
|
300,738
|
|
|
Various dates between 2018 and 2023
|
Columbia Gas Transmission Corp.
|
50,000
|
|
|
Various dates between 2024 and 2030
|
Transcontinental Gas Pipe Line Corp.
|
42,531
|
|
|
Various dates between 2018 and 2032
|
Tennessee Gas Pipeline Co.
|
25,166
|
|
|
Various dates between 2018 and 2023
|
Algonquin Gas Transmission
|
12,000
|
|
|
2019
|
Total
|
430,435
|
|
|
|
(1)
|
Numbers are shown net of any capacity release contracted amounts.
|
Pipeline
|
Dths
|
Expiration
|
||
Texas Eastern Transmission, L.P.
|
94,557
|
|
|
2019
|
Transcontinental Gas Pipe Line Corp.
|
8,384
|
|
|
2019
|
Total
|
102,941
|
|
|
|
•
|
Providing natural gas portfolio management services to nonaffiliated and affiliated natural gas utilities, electric generation facilities and natural gas producers;
|
•
|
Managing strategies for new and existing natural gas storage and transportation assets to capture value from changes in price due to location or timing differences as a means to generate financial margin (as defined below);
|
•
|
Managing transactional logistics to minimize
the cost of natural gas delivery to customers while maintaining security of supply. Transactions utilize the most optimal and advantageous natural gas supply transportation routing available within its contractual asset portfolio and various market areas
; and
|
•
|
Managing economic hedging programs that are designed to mitigate the impact
of changes in market prices on financial margin generated on its natural gas storage and transportation commitments.
|
•
|
NJR Steckman Ridge Storage Company, which holds the Company’s
50 percent
equity investment in Steckman Ridge. Steckman Ridge is a Delaware limited partnership, jointly owned and controlled by subsidiaries of the Company and subsidiaries of Enbridge Inc., that built, owns and operates a natural gas storage facility with up to
12
Bcf of working gas capacity in Bedford County, Pennsylvania. The facility has direct access to the Texas Eastern and Dominion Transmission pipelines and has access to the Northeast and Mid-Atlantic markets;
|
•
|
NJR Pipeline Company, which consists of a
20 percent
equity investment in PennEast. PennEast is expected to construct a
120
-mile FERC-regulated interstate natural gas pipeline system that will extend from northern Pennsylvania to western New Jersey and is estimated to be completed and operational in
2019
; and
|
•
|
NJR Midstream Holdings Corporation, which,
through its subsidiary NJNR Pipeline Company, holds approximately
1.84 million
DM Common Units.
|
•
|
NJRHS, which provides heating, ventilation and cooling service,
sales and installation of appliances
to approximately
112,000
service contract customers, as well as installation of solar equipment;
|
•
|
NJRPS, which provides plumbing repair and installation services;
|
•
|
CR&R, which holds commercial real estate;
|
•
|
NJR Energy, which was dissolved on
November 28
, 2016, invested in energy-related ventures; and
|
•
|
NJR Service Corporation, which provides shared administrative and financial services to the Company and all of its subsidiaries.
|
•
|
Annual reports on Form 10-K;
|
•
|
Quarterly reports on Form 10-Q; and
|
•
|
Current reports on Form 8-K.
|
•
|
Bylaws;
|
•
|
Corporate Governance Guidelines;
|
•
|
Wholesale Trading Code of Conduct;
|
•
|
NJR Code of Conduct;
|
•
|
Charters of the following Board of Directors Committees: Audit, Leadership Development and Compensation and Nominating/Corporate Governance;
|
•
|
Audit Complaint Procedure;
|
•
|
Communicating with Non-Management Directors Procedure; and
|
•
|
Statement of Policy with Respect to Related Person Transactions.
|
•
|
economic weakness and/or political instability in the United States or in the regions where we operate;
|
•
|
political conditions, such as a shutdown of the U.S. federal government;
|
•
|
financial difficulties of unrelated energy companies;
|
•
|
capital market conditions generally;
|
•
|
volatility in the equity markets;
|
•
|
market prices for natural gas;
|
•
|
the overall health of the natural gas utility industry; and
|
•
|
fluctuations in interest rates
, particularly with respect to NJNG’s variable rate debt instruments.
|
Name
|
Age
|
Officer
since
|
Office held during last five years
|
Laurence M. Downes
|
60
|
1986
|
Chairman of the Board (September 1996 - present)
President and Chief Executive Officer (July 1995 - present) |
Patrick J. Migliaccio
|
43
|
2013
|
Senior Vice President (January 2016 - present)
Chief Financial Officer (January 2016 - present) Vice President, Finance and Accounting (November 2014 - December 2015) Treasurer (August 2013 - May 2015) Corporate Controller (January 2012 - August 2013) |
Stephen D. Westhoven
|
49
|
2004
|
Executive Vice President and Chief Operating Officer (November 2017 - present)
Senior Vice President and Chief Operating Officer, NJRES and NJRCEV (October 2016 - October 2017) Senior Vice President, NJRES (May 2010 - September 2016) |
Kathleen T. Ellis
|
64
|
2004
|
Executive Vice President, Policy and Strategic Development, NJR (October 2016 - present)
Executive Vice President and Chief Operating Officer, NJNG (February 2008 - September 2016) Senior Vice President, Corporate Affairs (December 2004 - present) |
Amanda E. Mullan
|
51
|
2015
|
Senior Vice President and Chief Human Resources Officer (January 2017 - present)
Vice President and Chief Human Resources Officer (April 2015 - December 2016) Senior Vice President of HR, N. America, Willis Group Holdings, a risk management and insurance intermediary (April 2012 - April 2015) |
Jacqueline K. Shea
|
53
|
2016
|
Vice President and Chief Information Officer (June 2016 - present)
Chief Information Officer, Godiva Chocolatier, a manufacturer of premium fine chocolates and related products (March 2011 - May 2016) |
Nancy A. Washington
|
53
|
2017
|
Senior Vice President and General Counsel (March 2017 - present)
Senior Vice President and Chief Litigation Counsel, CIT Group Inc., a Livingston, NJ-based financial services firm (September 2010 - March 2017) |
|
2017
|
2016
|
Dividends Paid
|
|||
|
High
|
Low
|
High
|
Low
|
2017
|
2016
|
Fiscal Quarter
|
|
|
|
|
|
|
First
|
$37.30
|
$30.46
|
$34.07
|
$28.02
|
$0.255
|
$0.240
|
Second
|
$39.95
|
$33.70
|
$36.85
|
$32.32
|
$0.255
|
$0.240
|
Third
|
$43.50
|
$38.95
|
$38.56
|
$33.91
|
$0.255
|
$0.240
|
Fourth
|
$44.30
|
$39.50
|
$38.92
|
$32.27
|
$0.255
|
$0.240
|
Period
|
Total Number of Shares
(or Units) Purchased
|
Average Price Paid per Share (or Unit)
|
Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs
|
Maximum Number (or Approximate Dollar Value) of Shares (or Units) That May Yet Be Purchased Under the Plans or Programs
|
||||
7/01/17 - 7/31/17
|
—
|
$
|
—
|
|
—
|
|
|
2,431,053
|
8/01/17 - 8/31/17
|
—
|
$
|
—
|
|
—
|
|
|
2,431,053
|
9/01/17 - 9/30/17
|
—
|
$
|
—
|
|
—
|
|
|
2,431,053
|
Total
|
—
|
$
|
—
|
|
—
|
|
|
2,431,053
|
(Thousands, except per share data)
|
|
|
|
|
|
||||||||||
Fiscal Years Ended September 30,
|
2017
|
2016
|
2015
|
2014
|
2013
|
||||||||||
SELECTED FINANCIAL DATA
|
|
|
|
|
|
||||||||||
Operating revenues
|
$
|
2,268,617
|
|
$
|
1,880,905
|
|
$
|
2,733,987
|
|
$
|
3,738,145
|
|
$
|
3,198,068
|
|
Gas purchases
|
$
|
1,703,767
|
|
$
|
1,352,686
|
|
$
|
2,085,645
|
|
$
|
3,139,525
|
|
$
|
2,712,223
|
|
Net income
|
$
|
132,065
|
|
$
|
131,672
|
|
$
|
180,960
|
|
$
|
141,970
|
|
$
|
114,809
|
|
Total assets
|
$
|
3,928,507
|
|
$
|
3,718,570
|
|
$
|
3,284,357
|
|
$
|
3,125,388
|
|
$
|
3,001,414
|
|
Common stock equity
|
$
|
1,236,643
|
|
$
|
1,166,591
|
|
$
|
1,106,956
|
|
$
|
966,166
|
|
$
|
887,384
|
|
Long-term debt
(1) (2)
|
$
|
997,080
|
|
$
|
1,055,038
|
|
$
|
843,595
|
|
$
|
598,209
|
|
$
|
512,886
|
|
|
|
|
|
|
|
||||||||||
COMMON STOCK DATA
|
|
|
|
|
|
||||||||||
Earnings per share-basic
|
$1.53
|
$1.53
|
$2.12
|
$1.69
|
$1.38
|
||||||||||
Earnings per share-diluted
|
$1.52
|
$1.52
|
$2.10
|
$1.67
|
$1.37
|
||||||||||
Dividends declared per share
|
$1.038
|
$0.975
|
$0.915
|
$0.855
|
$0.810
|
||||||||||
|
|
|
|
|
|
||||||||||
NON-GAAP RECONCILIATION
|
|
|
|
|
|
||||||||||
Net income
|
$
|
132,065
|
|
$
|
131,672
|
|
$
|
180,960
|
|
$
|
141,970
|
|
$
|
114,809
|
|
Add:
|
|
|
|
|
|
||||||||||
Unrealized (gain) loss on derivative instruments and related transactions
|
(11,241
|
)
|
46,883
|
|
(38,681
|
)
|
28,534
|
|
(9,418
|
)
|
|||||
Tax effect
|
4,062
|
|
(17,018
|
)
|
14,391
|
|
(10,492
|
)
|
3,462
|
|
|||||
Effects of economic hedging related to natural gas inventory
|
38,470
|
|
(36,816
|
)
|
(8,225
|
)
|
26,639
|
|
7,635
|
|
|||||
Tax effect
|
(13,964
|
)
|
13,364
|
|
3,058
|
|
(9,794
|
)
|
(2,807
|
)
|
|||||
Net financial earnings
(3)
|
$
|
149,392
|
|
$
|
138,085
|
|
$
|
151,503
|
|
$
|
176,857
|
|
$
|
113,681
|
|
|
|
|
|
|
|
||||||||||
Basic earnings per share
|
$1.53
|
$1.53
|
$2.12
|
$1.69
|
$1.38
|
||||||||||
Add:
|
|
|
|
|
|
||||||||||
Unrealized (gain) loss on derivative instruments and related transactions
|
(0.13
|
)
|
0.55
|
|
(0.45
|
)
|
0.34
|
|
(0.11
|
)
|
|||||
Tax effect
|
0.05
|
|
(0.20
|
)
|
0.17
|
|
(0.13
|
)
|
0.04
|
|
|||||
Effects of economic hedging related to natural gas inventory
|
0.45
|
|
(0.43
|
)
|
(0.10
|
)
|
0.32
|
|
0.09
|
|
|||||
Tax effect
|
(0.17
|
)
|
0.16
|
|
0.04
|
|
(0.12
|
)
|
(0.04
|
)
|
|||||
Net financial earnings per share-basic
(3)
|
$1.73
|
$1.61
|
$1.78
|
$2.10
|
$1.36
|
||||||||||
|
|
|
|
|
|
||||||||||
Diluted earnings per share
|
$1.52
|
$1.52
|
$2.10
|
$1.67
|
$1.37
|
||||||||||
Add:
|
|
|
|
|
|
||||||||||
Unrealized (gain) loss on derivative instruments and related transactions
|
(0.13
|
)
|
0.54
|
|
(0.45
|
)
|
0.34
|
|
(0.11
|
)
|
|||||
Tax effect
|
0.05
|
|
(0.20
|
)
|
0.17
|
|
(0.12
|
)
|
0.04
|
|
|||||
Effects of economic hedging related to natural gas inventory
|
0.44
|
|
(0.42
|
)
|
(0.10
|
)
|
0.31
|
|
0.09
|
|
|||||
Tax effect
|
(0.17
|
)
|
0.15
|
|
0.04
|
|
(0.12
|
)
|
(0.03
|
)
|
|||||
Net financial earnings per share-diluted
(3)
|
$1.71
|
$1.59
|
$1.76
|
$2.08
|
$1.36
|
(1)
|
Includes long-term capital leases of
$28.9 million
,
$30.7 million
,
$35.7 million
,
$40.4 million
and
$43 million
, respectively.
|
(2)
|
Includes long-term solar asset financing obligation of
$28.2 million
in
fiscal 2017
.
|
(3)
|
NFE is a non-GAAP financial measure that eliminates the timing differences surrounding the recognition of certain derivative gains or losses, to effectively match the earnings effects of economic hedges associated with the physical sale or purchase of gas and, therefore, eliminate the impact of volatility to GAAP earnings associated with the related derivative instruments. For further discussion of this financial measure, see the Energy Services segment in
Item 7. Management
’
s Discussion and Analysis of Financial Condition and Results of Operations
.
|
Fiscal Years Ended September 30,
|
2017
|
2016
|
2015
|
2014
|
2013
|
||||||||||
Operating revenues
($ in thousands)
|
|
|
|
|
|
||||||||||
Residential
|
$
|
395,315
|
|
$
|
345,597
|
|
$
|
466,464
|
|
$
|
469,831
|
|
$
|
467,269
|
|
Commercial, industrial and other
|
98,777
|
|
80,994
|
|
106,505
|
|
110,740
|
|
99,736
|
|
|||||
Firm transportation
|
73,206
|
|
69,696
|
|
77,974
|
|
86,131
|
|
73,745
|
|
|||||
Total residential and commercial
|
567,298
|
|
496,287
|
|
650,943
|
|
666,702
|
|
640,750
|
|
|||||
Interruptible
|
7,970
|
|
8,867
|
|
10,049
|
|
9,384
|
|
9,066
|
|
|||||
Total system
|
575,268
|
|
505,154
|
|
660,992
|
|
676,086
|
|
649,816
|
|
|||||
BGSS incentive programs
|
120,369
|
|
89,192
|
|
120,978
|
|
143,329
|
|
138,171
|
|
|||||
Total operating revenues
|
$
|
695,637
|
|
$
|
594,346
|
|
$
|
781,970
|
|
$
|
819,415
|
|
$
|
787,987
|
|
Throughput (Bcf)
|
|
|
|
|
|
||||||||||
Residential
|
40.7
|
|
36.9
|
|
45.9
|
|
43.1
|
|
38.3
|
|
|||||
Commercial, industrial and other
|
8.7
|
|
7.3
|
|
9.6
|
|
8.2
|
|
7.5
|
|
|||||
Firm transportation
|
14.4
|
|
14.1
|
|
16.0
|
|
17.7
|
|
15.2
|
|
|||||
Total residential and commercial
|
63.8
|
|
58.3
|
|
71.5
|
|
69.0
|
|
61.0
|
|
|||||
Interruptible
|
55.0
|
|
61.5
|
|
47.1
|
|
10.5
|
|
10.9
|
|
|||||
Total system
|
118.8
|
|
119.8
|
|
118.6
|
|
79.5
|
|
71.9
|
|
|||||
BGSS incentive programs
|
178.4
|
|
216.7
|
|
222.4
|
|
180.8
|
|
141.5
|
|
|||||
Total throughput
|
297.2
|
|
336.5
|
|
341.0
|
|
260.3
|
|
213.4
|
|
|||||
Customers at year-end
|
|
|
|
|
|
||||||||||
Residential
|
460,013
|
|
448,273
|
|
437,979
|
|
422,742
|
|
408,399
|
|
|||||
Commercial, industrial and other
|
26,947
|
|
26,218
|
|
25,541
|
|
24,684
|
|
24,302
|
|
|||||
Firm transportation
|
42,790
|
|
46,608
|
|
48,673
|
|
56,777
|
|
64,651
|
|
|||||
Total residential and commercial
|
529,750
|
|
521,099
|
|
512,193
|
|
504,203
|
|
497,352
|
|
|||||
Interruptible
|
33
|
|
34
|
|
35
|
|
37
|
|
41
|
|
|||||
BGSS incentive programs
|
27
|
|
30
|
|
24
|
|
34
|
|
38
|
|
|||||
Total customers at year-end
|
529,810
|
|
521,163
|
|
512,252
|
|
504,274
|
|
497,431
|
|
|||||
Interest coverage ratio
(1)
|
7.96
|
|
8.97
|
|
9.57
|
|
10.24
|
|
10.82
|
|
|||||
Average therm use per customer
|
|
|
|
|
|
||||||||||
Residential
|
885
|
|
824
|
|
1,049
|
|
1,020
|
|
937
|
|
|||||
Commercial, industrial and other
|
11,183
|
|
11,378
|
|
9,799
|
|
4,466
|
|
3,773
|
|
|||||
Degree days
|
4,129
|
|
3,867
|
|
5,015
|
|
5,080
|
|
4,664
|
|
|||||
Weather as a percent of normal
(2)
|
90.0
|
%
|
82.5
|
%
|
108.3
|
%
|
109.6
|
%
|
99.9
|
%
|
|||||
Number of employees
|
680
|
|
670
|
|
649
|
|
626
|
|
611
|
|
(1)
|
NJNG
’
s income from operations divided by interest expense.
|
(2)
|
Normal heating degree days are based on a 20-year average, calculated based upon three reference areas representative of NJNG
’
s service territory.
|
Pension Plans
|
|
|
|
|
|
|
|
|
|||||
Actuarial Assumptions
|
Increase/
(Decrease)
|
Estimated
Increase/(Decrease) on PBO (Thousands) |
Estimated
Increase/(Decrease) to Expense (Thousands) |
||||||||||
Discount rate
|
1.00
|
|
%
|
|
$
|
(38,398
|
)
|
|
|
$
|
(3,875
|
)
|
|
Discount rate
|
(1.00
|
)
|
%
|
|
$
|
48,110
|
|
|
|
$
|
4,720
|
|
|
Rate of return on plan assets
|
1.00
|
|
%
|
|
n/a
|
|
|
$
|
(2,493
|
)
|
|
||
Rate of return on plan assets
|
(1.00
|
)
|
%
|
|
n/a
|
|
|
$
|
2,493
|
|
|
Other Postemployment Benefits
|
|
|
|
|
|
|
|
|
|||||
Actuarial Assumptions
|
Increase/
(Decrease)
|
Estimated
Increase/(Decrease) on PBO (Thousands) |
Estimated
Increase/(Decrease) to Expense (Thousands) |
||||||||||
Discount rate
|
1.00
|
|
%
|
|
$
|
(25,977
|
)
|
|
|
$
|
(2,447
|
)
|
|
Discount rate
|
(1.00
|
)
|
%
|
|
$
|
33,412
|
|
|
|
$
|
3,072
|
|
|
Rate of return on plan assets
|
1.00
|
|
%
|
|
n/a
|
|
|
$
|
(615
|
)
|
|
||
Rate of return on plan assets
|
(1.00
|
)
|
%
|
|
n/a
|
|
|
$
|
615
|
|
|
||
|
|
|
|
|
|
|
|
|
|||||
Actuarial Assumptions
|
Increase/
(Decrease)
|
Estimated
Increase/(Decrease) on PBO (Thousands) |
Estimated
Increase/(Decrease) to Expense (Thousands) |
||||||||||
Health care cost trend rate
|
1.00
|
|
%
|
|
$
|
32,019
|
|
|
|
$
|
4,353
|
|
|
Health care cost trend rate
|
(1.00
|
)
|
%
|
|
$
|
(25,466
|
)
|
|
|
$
|
(3,624
|
)
|
|
($ in thousands)
|
2017
|
2016
|
2015
|
|||||||||||||||
|
Net Income
|
Assets
|
Net Income
|
Assets
|
Net Income
|
Assets
|
||||||||||||
Natural Gas Distribution
|
$
|
86,930
|
|
$
|
2,519,578
|
|
$
|
76,104
|
|
$
|
2,517,401
|
|
$
|
76,287
|
|
$
|
2,305,293
|
|
Clean Energy Ventures
|
24,873
|
|
771,340
|
|
28,393
|
|
665,696
|
|
20,101
|
|
504,885
|
|
||||||
Energy Services
|
476
|
|
398,277
|
|
14,265
|
|
327,626
|
|
72,044
|
|
260,021
|
|
||||||
Midstream
|
12,857
|
|
232,806
|
|
9,406
|
|
186,259
|
|
9,780
|
|
182,007
|
|
||||||
Home Services and Other
|
6,811
|
|
114,801
|
|
2,882
|
|
109,487
|
|
3,420
|
|
88,880
|
|
||||||
Intercompany
(1)
|
118
|
|
(108,295
|
)
|
622
|
|
(87,899
|
)
|
(672
|
)
|
(56,729
|
)
|
||||||
Total
|
$
|
132,065
|
|
$
|
3,928,507
|
|
$
|
131,672
|
|
$
|
3,718,570
|
|
$
|
180,960
|
|
$
|
3,284,357
|
|
(1)
|
Consists of transactions between subsidiaries that are eliminated in consolidation.
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Net income
|
$
|
132,065
|
|
$
|
131,672
|
|
$
|
180,960
|
|
Add:
|
|
|
|
||||||
Unrealized (gain) loss on derivative instruments and related transactions
|
(11,241
|
)
|
46,883
|
|
(38,681
|
)
|
|||
Tax effect
|
4,062
|
|
(17,018
|
)
|
14,391
|
|
|||
Effects of economic hedging related to natural gas inventory
(1)
|
38,470
|
|
(36,816
|
)
|
(8,225
|
)
|
|||
Tax effect
|
(13,964
|
)
|
13,364
|
|
3,058
|
|
|||
Net financial earnings
|
$
|
149,392
|
|
$
|
138,085
|
|
$
|
151,503
|
|
|
|
|
|
||||||
Basic earnings per share
|
$
|
1.53
|
|
$
|
1.53
|
|
$
|
2.12
|
|
Add:
|
|
|
|
||||||
Unrealized (gain) loss on derivative instruments and related transactions
|
(0.13
|
)
|
0.55
|
|
(0.45
|
)
|
|||
Tax effect
|
0.05
|
|
(0.20
|
)
|
0.17
|
|
|||
Effects of economic hedging related to natural gas inventory
(1)
|
0.45
|
|
(0.43
|
)
|
(0.10
|
)
|
|||
Tax effect
|
(0.17
|
)
|
0.16
|
|
0.04
|
|
|||
Basic net financial earnings per share
|
$
|
1.73
|
|
$
|
1.61
|
|
$
|
1.78
|
|
(1)
|
Effects of hedging natural gas inventory transactions where the economic impact is realized in a future period.
|
(Thousands)
|
2017
|
|
2016
|
|
2015
|
||||||||||||
Natural Gas Distribution
|
$
|
86,930
|
|
58
|
%
|
|
$
|
76,104
|
|
55
|
%
|
|
$
|
76,287
|
|
51
|
%
|
Clean Energy Ventures
|
24,873
|
|
17
|
|
|
28,393
|
|
20
|
|
|
20,101
|
|
13
|
|
|||
Energy Services
|
18,554
|
|
12
|
|
|
21,934
|
|
16
|
|
|
42,122
|
|
28
|
|
|||
Midstream
|
12,857
|
|
9
|
|
|
9,406
|
|
7
|
|
|
9,780
|
|
6
|
|
|||
Home Services and Other
|
6,811
|
|
4
|
|
|
2,882
|
|
2
|
|
|
3,420
|
|
2
|
|
|||
Eliminations
(1)
|
(633
|
)
|
—
|
|
|
(634
|
)
|
—
|
|
|
(207
|
)
|
—
|
|
|||
Total
|
$
|
149,392
|
|
100
|
%
|
|
$
|
138,085
|
|
100
|
%
|
|
$
|
151,503
|
|
100
|
%
|
(1)
|
Consists
of transactions between subsidiaries that are eliminated in consolidation
.
|
•
|
earning a reasonable rate of return on the investments in its natural gas distribution
and transmission businesses
, as well as timely recovery of all prudently incurred costs to provide safe and reliable service throughout NJNG
’
s territory;
|
•
|
continuing to invest in the safety and integrity of its infrastructure;
|
•
|
managing its customer growth rate, which NJNG expects will be approximately
1.7 percent
annually through fiscal
2019
;
|
•
|
maintaining a collaborative relationship with the BPU on regulatory initiatives, including:
|
•
|
managing the volatility of wholesale natural gas prices through a hedging program designed to keep customers
’
BGSS rates as stable as possible; and
|
•
|
working with the NJDEP and BPU to manage its financial obligations related to remediation activities associated with its former MGP sites.
|
•
|
an increase in base rates in the amount of
$45 million
. The base rate increase includes a return on common equity of
9.75 percent
, a common equity ratio of
52.5 percent
and an increase in the overall depreciation rate from
2.34 percent
to
2.4 percent
;
|
•
|
the recovery of SAFE I capital investments and the rate mechanism and five-year extension of SAFE II. The estimated cost for SAFE II extension, excluding AFUDC, is approximately
$200 million
and related costs to be recovered on an accelerated basis are approximately
$157.5 million
. As a condition of the extension approval, NJNG is required to file a base rate case no later than November 2019;
|
•
|
rate recovery of NJ RISE capital investment costs through June 30, 2016, and the filing for recovery of future NJ RISE capital investment costs to be recovered, will occur in conjunction with SAFE II, commencing with the rate recovery filing submitted in March 2017;
|
•
|
recovery of NJNG’s NGV and LNG plant investments; and
|
•
|
recovery of other costs previously deferred in regulatory assets over seven years.
|
|
2017
|
2016
|
2015
|
|||
Firm customers
|
|
|
|
|||
Residential
|
460,013
|
|
448,273
|
|
437,979
|
|
Commercial, industrial & other
|
26,947
|
|
26,218
|
|
25,541
|
|
Residential transport
|
32,653
|
|
36,292
|
|
38,424
|
|
Commercial transport
|
10,137
|
|
10,316
|
|
10,249
|
|
Total firm customers
|
529,750
|
|
521,099
|
|
512,193
|
|
Other
|
60
|
|
64
|
|
59
|
|
Total customers
|
529,810
|
|
521,163
|
|
512,252
|
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Weather
(1)
|
$
|
19,261
|
|
$
|
27,547
|
|
$
|
(9,268
|
)
|
Usage
|
(2,309
|
)
|
10,420
|
|
3,132
|
|
|||
Total
|
$
|
16,952
|
|
$
|
37,967
|
|
$
|
(6,136
|
)
|
(1)
|
Compared with the CIP 20-year average, weather was
10 percent
and
17.5 percent
warmer
-than-normal during
fiscal 2017
and
2016
, respectively, and
8.3 percent
colder
-than-normal during
2015
.
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Operating revenues
|
$
|
695,637
|
|
$
|
594,346
|
|
$
|
781,970
|
|
Operating expenses
|
|
|
|
||||||
Gas purchases
(1) (2)
|
269,480
|
|
215,849
|
|
355,779
|
|
|||
Operation and maintenance
|
142,509
|
|
130,575
|
|
129,774
|
|
|||
Regulatory rider expense
(3)
|
40,243
|
|
39,300
|
|
75,779
|
|
|||
Depreciation and amortization
|
49,347
|
|
47,828
|
|
43,085
|
|
|||
Energy and other taxes
(4)
|
42,417
|
|
34,561
|
|
47,506
|
|
|||
Total operating expenses
|
543,996
|
|
468,113
|
|
651,923
|
|
|||
Operating income
|
151,641
|
|
126,233
|
|
130,047
|
|
|||
Other income, net
|
4,592
|
|
4,752
|
|
4,318
|
|
|||
Interest expense, net of capitalized interest
|
25,818
|
|
19,930
|
|
18,534
|
|
|||
Income tax provision
|
43,485
|
|
34,951
|
|
39,544
|
|
|||
Net income
|
$
|
86,930
|
|
$
|
76,104
|
|
$
|
76,287
|
|
(1)
|
Includes the purchased cost of the natural gas, fees paid to pipelines and storage facilities, adjustments as a result of BGSS incentive programs and hedging transactions. These expenses are passed through to customers and are offset by corresponding revenues.
|
(2)
|
Includes related party transactions of approximately
$10.8 million
,
$10.8 million
and
$50.8 million
during
fiscal 2017
,
2016
and
2015
, respectively, a portion of which are eliminated in consolidation.
|
(3)
|
Consists of expenses associated with state-mandated programs, the RAC and energy efficiency programs, and are calculated on a per-therm basis. These expenses are passed through to customers and offset by corresponding revenues.
|
(4)
|
Consists primarily of sales tax, which is passed through to customers and offset by corresponding revenues.
|
|
2017 v. 2016
|
|
2016 v. 2015
|
||||||||||
(Millions)
|
Operating
revenue
|
Gas
purchases
|
|
Operating
revenue
|
Gas
purchases
|
||||||||
Firm sales
|
$
|
44.4
|
|
$
|
21.6
|
|
|
$
|
(116.1
|
)
|
$
|
(50.4
|
)
|
Rate impact
(1)
|
37.4
|
|
—
|
|
|
—
|
|
—
|
|
||||
Bill credits
(2)
|
19.6
|
|
18.3
|
|
|
(61.6
|
)
|
(57.6
|
)
|
||||
Off-system sales
|
29.2
|
|
29.1
|
|
|
(32.1
|
)
|
(31.8
|
)
|
||||
Average BGSS rates
(3)
|
(17.9
|
)
|
(16.5
|
)
|
|
(2.7
|
)
|
(2.5
|
)
|
||||
CIP adjustments
|
(21.0
|
)
|
—
|
|
|
44.1
|
|
—
|
|
||||
Other
(4)
|
9.6
|
|
1.1
|
|
|
(19.2
|
)
|
2.4
|
|
||||
Total increase (decrease)
|
$
|
101.3
|
|
$
|
53.6
|
|
|
$
|
(187.6
|
)
|
$
|
(139.9
|
)
|
(1)
|
Includes rate adjustments for the base rate case, CIP and demand charges.
|
(2)
|
Operating revenues include changes in sales tax of
$1.3 million
and
$4 million
during during
fiscal 2017
and
2016
, respectively
.
|
(3)
|
Operating revenues include changes in sales tax of
$1.4 million
and
$200,000
during
fiscal 2017
and
2016
, respectively.
|
(4)
|
Other includes changes in rider rates, including those related to NJCEP and other programs.
|
•
|
increased firm sales due primarily to customer growth and higher usage, related to weather being
6.8 percent
colder
;
|
•
|
increased base rates resulting from the settlement of the base rate case;
|
•
|
higher
off-system sales due primarily to a
49.8 percent
increase
in the average price of gas sold, partially offset by a
12.2 percent
reduction
in volumes
;
|
•
|
a decrease in bill credits issued to residential and small commercial customers during the months of November 2016 through February 2017 compared with the same period last year;
partially offset by
|
•
|
a
decrease
in CIP due primarily to weather, partially offset by changes in the CIP as a result of the settlement of the base rate case.
|
•
|
decreased firm sales due primarily to lower usage related to weather being
22.9 percent warmer;
|
•
|
bill credits issued to residential and small commercial customers effective November 1, 2015, which were not issued during fiscal 2015;
|
•
|
lower
off-system sales due primarily to a
38.3 percent
decrease in the average price of gas sold, partially offset by a
18.4 percent
increase in volumes;
|
•
|
a decrease in rider revenues, categorized in other, due primarily to a 36.3 percent decrease in rates and a 18.5 percent decrease in usage; partially offset by
|
•
|
an increase in CIP adjustments of $36.8 million
related to weather and $7.3 million
related to usage.
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Operating revenues
|
$
|
695,637
|
|
$
|
594,346
|
|
$
|
781,970
|
|
Less:
|
|
|
|
||||||
Gas purchases
|
269,480
|
|
215,849
|
|
355,779
|
|
|||
Energy taxes
|
37,917
|
|
29,832
|
|
42,929
|
|
|||
Regulatory rider expense
|
40,243
|
|
39,300
|
|
75,779
|
|
|||
Utility gross margin
|
$
|
347,997
|
|
$
|
309,365
|
|
$
|
307,483
|
|
•
|
utility firm gross margin generated from only the delivery component of either a sales tariff or a transportation tariff from residential and commercial customers who receive natural gas service from NJNG;
|
•
|
BGSS incentive programs, where revenues generated or savings achieved from BPU-approved off-system sales, capacity release or storage incentive programs are shared between customers and NJNG; and
|
•
|
utility gross margin generated from off-tariff customers, as well as interruptible customers.
|
|
2017
|
|
2016
|
|
2015
|
||||||||||||
($ in thousands)
|
Margin
|
Bcf
|
|
Margin
|
Bcf
|
|
Margin
|
Bcf
|
|||||||||
Utility gross margin/throughput
|
|
|
|
|
|
|
|
|
|||||||||
Residential
|
$
|
218,093
|
|
40.7
|
|
|
$
|
187,762
|
|
36.9
|
|
|
$
|
182,407
|
|
45.9
|
|
Commercial, industrial and other
|
51,510
|
|
8.7
|
|
|
46,878
|
|
7.3
|
|
|
47,162
|
|
9.6
|
|
|||
Firm transportation
|
58,172
|
|
14.4
|
|
|
54,841
|
|
14.1
|
|
|
55,614
|
|
16.0
|
|
|||
Total utility firm gross margin/throughput
|
327,775
|
|
63.8
|
|
|
289,481
|
|
58.3
|
|
|
285,183
|
|
71.5
|
|
|||
BGSS incentive programs
|
13,724
|
|
178.4
|
|
|
14,978
|
|
216.7
|
|
|
17,707
|
|
222.4
|
|
|||
Interruptible/off-tariff agreements
|
6,498
|
|
55.0
|
|
|
4,906
|
|
61.5
|
|
|
4,593
|
|
47.1
|
|
|||
Total utility gross margin/throughput
|
$
|
347,997
|
|
297.2
|
|
|
$
|
309,365
|
|
336.5
|
|
|
$
|
307,483
|
|
341.0
|
|
(Thousands)
|
2017 v. 2016
|
2016 v. 2015
|
||||||||
Rate impact
|
|
$
|
35,019
|
|
|
|
$
|
—
|
|
|
Customer growth
|
|
3,619
|
|
|
|
3,436
|
|
|
||
SAVEGREEN
|
|
(345
|
)
|
|
|
862
|
|
|
||
Total increase
|
|
$
|
38,293
|
|
|
|
$
|
4,298
|
|
|
(Thousands)
|
2017 v. 2016
|
2016 v. 2015
|
||||||||
Capacity release
|
|
$
|
(1,672
|
)
|
|
|
$
|
(758
|
)
|
|
Storage
|
|
378
|
|
|
|
(1,184
|
)
|
|
||
Off-system sales
|
|
39
|
|
|
|
(278
|
)
|
|
||
FRM
|
|
—
|
|
|
|
(509
|
)
|
|
||
Total (decrease) increase
|
|
$
|
(1,255
|
)
|
|
|
$
|
(2,729
|
)
|
|
(Thousands)
|
2017 v. 2016
|
2016 v. 2015
|
||||||||
Compensation and benefits
|
|
$
|
5,412
|
|
|
|
$
|
898
|
|
|
Base rate amortization of regulatory assets
|
|
3,264
|
|
|
|
—
|
|
|
||
Shared corporate costs
|
|
3,061
|
|
|
|
2,378
|
|
|
||
Other
|
|
197
|
|
|
|
(2,475
|
)
|
|
||
Total increase
|
|
$
|
11,934
|
|
|
|
$
|
801
|
|
|
•
|
increased compensation costs due primarily to increases in headcount, incentives, healthcare premiums, lower capitalized labor and increased pension/OPEB benefit costs related to changes in actuarial assumptions, partially offset by implementation of the spot rate method to measure interest and service cost components;
|
•
|
additional amortization of regulatory assets that are being recovered as a result of the settlement of the base rate case; and
|
•
|
increased shared corporate costs resulting primarily from increased software maintenance, incentives, postemployment costs and healthcare premiums.
|
•
|
increased shared corporate costs resulting primarily from increased head count and healthcare premiums, as well as increased temporary staffing and consulting services;
|
•
|
increased compensation costs at NJNG due primarily to increased head count and healthcare premiums, partially offset by reduced pension expense due to an increase in expected return on assets associated with a $30 million discretionary contribution in November 2015; partially offset by
|
•
|
lower consulting costs due primarily to reduced software maintenance and tax audit expenses, lower bad debt expense due primarily to a decrease in write-offs of customer receivables and lower maintenance and repairs due primarily to the much warmer winter weather in
fiscal 2016
.
|
•
|
a decrease in pre-tax income;
|
•
|
the revaluation of the deferred tax liability in
fiscal 2015
;
|
•
|
a change in the method of accounting for equity compensation due to the adoption of
ASU 2016-09, which resulted in the recognition of excess tax benefits related to vested stock compensation for which the tax deduction exceeded the associated expense. See
Note 2. Summary of Significant Accounting Policies
- Recently Adopted Updates to the Accounting Standards Codification
in the accompanying Consolidated Financial Statements for a more detailed discussion; and
|
•
|
an increase in costs of retiring assets placed into service prior to 1981.
|
($ in Thousands)
|
2017
|
2016
|
2015
|
||||||||||||||||||
Placed in service
|
Projects
|
MW
|
Costs
|
Projects
|
MW
|
Costs
|
Projects
|
MW
|
Costs
|
||||||||||||
Grid-connected
(1)
|
2
|
|
20.0
|
|
$
|
62,700
|
|
5
|
|
21.8
|
|
$
|
51,240
|
|
4
|
|
26.1
|
|
$
|
66,424
|
|
Net-metered:
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial
(1)
|
3
|
|
7.1
|
|
19,714
|
|
—
|
|
—
|
|
3
|
|
1
|
|
0.4
|
|
1,382
|
|
|||
Residential
|
1,300
|
|
12.4
|
|
37,901
|
|
1,123
|
|
10.4
|
|
34,318
|
|
829
|
|
7.8
|
|
24,973
|
|
|||
Total placed in service
|
1,305
|
|
39.5
|
|
$
|
120,315
|
|
1,128
|
|
32.2
|
|
$
|
85,561
|
|
834
|
|
34.3
|
|
$
|
92,779
|
|
(1)
|
Includes projects subject to sale-leaseback arrangements.
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Operating revenues
|
$
|
64,394
|
|
$
|
53,540
|
|
$
|
32,513
|
|
Operating expenses
|
|
|
|
||||||
Operation and maintenance
|
23,448
|
|
18,897
|
|
15,248
|
|
|||
Depreciation and amortization
|
31,834
|
|
23,971
|
|
17,297
|
|
|||
Other taxes
|
1,209
|
|
900
|
|
726
|
|
|||
Total operating expenses
|
56,491
|
|
43,768
|
|
33,271
|
|
|||
Operating income (loss)
|
7,903
|
|
9,772
|
|
(758
|
)
|
|||
Other income, net
|
2,072
|
|
2,333
|
|
1,526
|
|
|||
Interest expense, net
|
16,263
|
|
10,304
|
|
7,635
|
|
|||
Income tax (benefit)
|
(31,161
|
)
|
(26,592
|
)
|
(26,968
|
)
|
|||
Net income
|
$
|
24,873
|
|
$
|
28,393
|
|
$
|
20,101
|
|
|
2017
|
2016
|
2015
|
|||
Inventory balance as of October 1,
|
24,135
|
|
33,203
|
|
29,970
|
|
SRECs generated
|
197,521
|
|
160,009
|
|
126,133
|
|
SRECs delivered
|
(173,299
|
)
|
(169,077
|
)
|
(122,900
|
)
|
Inventory balance as of September 30,
|
48,357
|
|
24,135
|
|
33,203
|
|
(1)
|
Energy years are compliance periods for New Jersey's renewable portfolio standard that run from June 1 to May 31.
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Operating revenues
(1)
|
$
|
1,462,681
|
|
$
|
1,197,253
|
|
$
|
1,934,307
|
|
Operating expenses
|
|
|
|
||||||
Gas purchases (including demand charges
(2)(3)
)
|
1,441,310
|
|
1,153,911
|
|
1,795,719
|
|
|||
Operation and maintenance
|
20,313
|
|
20,025
|
|
25,403
|
|
|||
Depreciation and amortization
|
63
|
|
88
|
|
90
|
|
|||
Other taxes
|
1,788
|
|
937
|
|
1,237
|
|
|||
Total operating expenses
|
1,463,474
|
|
1,174,961
|
|
1,822,449
|
|
|||
Operating (loss) income
|
(793
|
)
|
22,292
|
|
111,858
|
|
|||
Other income
|
1
|
|
98
|
|
438
|
|
|||
Interest expense, net
|
2,747
|
|
1,095
|
|
1,209
|
|
|||
Income tax (benefit) provision
|
(4,015
|
)
|
7,030
|
|
39,043
|
|
|||
Net income
|
$
|
476
|
|
$
|
14,265
|
|
$
|
72,044
|
|
(1)
|
Includes related party transactions of approximately
$316,000
,
$9.5 million
and
$61.5 million
during
fiscal 2017
,
2016
and
2015
, respectively, which is eliminated in consolidation.
|
(2)
|
Costs associated with pipeline and storage capacity that are expensed over the term of the related contracts, which generally varies from less than one year to 10 years.
|
(3)
|
Includes related party transactions of approximately
$4.6 million
,
$14.6 million
and
$27.9 million
during
fiscal 2017
,
2016
and
2015
, respectively, a portion of which are eliminated in consolidation.
|
(in Bcf)
|
2017
|
|
2016
|
|
2015
|
|
Net short futures contracts
|
16.4
|
|
79.1
|
|
91.1
|
|
Net long options
|
—
|
|
1.2
|
|
1.2
|
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Operating revenues
|
$
|
1,462,681
|
|
$
|
1,197,253
|
|
$
|
1,934,307
|
|
Less: Gas purchases
|
1,441,310
|
|
1,153,911
|
|
1,795,719
|
|
|||
Add:
|
|
|
|
||||||
Unrealized (gain) loss on derivative instruments and related transactions
(1)
|
(10,063
|
)
|
48,855
|
|
(39,408
|
)
|
|||
Effects of economic hedging related to natural gas inventory
(2)
|
38,470
|
|
(36,816
|
)
|
(8,225
|
)
|
|||
Financial margin
|
$
|
49,778
|
|
$
|
55,381
|
|
$
|
90,955
|
|
(1)
|
Includes unrealized (gains) losses related to an intercompany transaction between NJNG and Energy Services that have been eliminated in consolidation of approximately
$(751,000)
,
$(1.3) million
and
$465,000
for the fiscal years ended
September 30, 2017
,
2016
and
2015
, respectively.
|
(2)
|
Effects of hedging natural gas inventory transactions where the economic impact is realized in a future period.
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Operating (loss) income
|
$
|
(793
|
)
|
$
|
22,292
|
|
$
|
111,858
|
|
Add:
|
|
|
|
||||||
Operation and maintenance
|
20,313
|
|
20,025
|
|
25,403
|
|
|||
Depreciation and amortization
|
63
|
|
88
|
|
90
|
|
|||
Other taxes
|
1,788
|
|
937
|
|
1,237
|
|
|||
Subtotal
|
21,371
|
|
43,342
|
|
138,588
|
|
|||
Add:
|
|
|
|
||||||
Unrealized (gain) loss on derivative instruments and related transactions
|
(10,063
|
)
|
48,855
|
|
(39,408
|
)
|
|||
Effects of economic hedging related to natural gas inventory
|
38,470
|
|
(36,816
|
)
|
(8,225
|
)
|
|||
Financial margin
|
$
|
49,778
|
|
$
|
55,381
|
|
$
|
90,955
|
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Net income
|
$
|
476
|
|
$
|
14,265
|
|
$
|
72,044
|
|
Add:
|
|
|
|
||||||
Unrealized (gain) loss on derivative instruments and related transactions
|
(10,063
|
)
|
48,855
|
|
(39,408
|
)
|
|||
Tax effect
(1)
|
3,635
|
|
(17,734
|
)
|
14,653
|
|
|||
Effects of economic hedging related to natural gas inventory
|
38,470
|
|
(36,816
|
)
|
(8,225
|
)
|
|||
Tax effect
|
(13,964
|
)
|
13,364
|
|
3,058
|
|
|||
Net financial earnings
|
$
|
18,554
|
|
$
|
21,934
|
|
$
|
42,122
|
|
(1)
|
Includes taxes related to an intercompany transaction between NJNG and Energy Services that have been eliminated in consolidation of approximately
$427,000
and
$716,000
and
$(262,000)
for the fiscal years ended
September 30, 2017
,
2016
and
2015
, respectively.
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Equity in earnings of affiliates
|
$
|
17,797
|
|
$
|
13,936
|
|
$
|
17,487
|
|
Operation and maintenance
|
$
|
2,302
|
|
$
|
1,197
|
|
$
|
1,136
|
|
Other income
|
$
|
4,162
|
|
$
|
3,130
|
|
$
|
977
|
|
Interest expense, net
|
$
|
960
|
|
$
|
287
|
|
$
|
717
|
|
Income tax provision
|
$
|
5,820
|
|
$
|
6,130
|
|
$
|
6,849
|
|
Net income
|
$
|
12,857
|
|
$
|
9,406
|
|
$
|
9,780
|
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Steckman Ridge
|
$
|
13,351
|
|
$
|
14,050
|
|
$
|
12,330
|
|
Iroquois
(1)
|
—
|
|
—
|
|
5,164
|
|
|||
PennEast
|
4,446
|
|
(114
|
)
|
(7
|
)
|
|||
Total equity in earnings of affiliates
|
$
|
17,797
|
|
$
|
13,936
|
|
$
|
17,487
|
|
(1)
|
Transportation revenues generated by Iroquois ended
September 29, 2015
.
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Operating revenues
|
$
|
49,591
|
|
$
|
48,497
|
|
$
|
48,703
|
|
Operation and maintenance
|
$
|
40,245
|
|
$
|
40,106
|
|
$
|
39,601
|
|
Energy and other taxes
|
$
|
3,938
|
|
$
|
3,777
|
|
$
|
3,815
|
|
Other income, net
|
$
|
6,467
|
|
$
|
869
|
|
$
|
685
|
|
Income tax provision
|
$
|
3,857
|
|
$
|
1,387
|
|
$
|
1,551
|
|
Net income
|
$
|
6,811
|
|
$
|
2,882
|
|
$
|
3,420
|
|
|
2017
|
|
2016
|
|
Common stock equity
|
46
|
%
|
48
|
%
|
Long-term debt
|
38
|
|
44
|
|
Short-term debt
|
16
|
|
8
|
|
Total
|
100
|
%
|
100
|
%
|
|
|
Up to
|
2-3
|
4-5
|
After
|
||||||||||
(Thousands)
|
Total
|
1 Year
|
Years
|
Years
|
5 Years
|
||||||||||
Long-term debt
(1)
|
$
|
1,548,726
|
|
$
|
184,769
|
|
$
|
157,472
|
|
$
|
105,694
|
|
$
|
1,100,791
|
|
Capital lease obligations
(1)
|
44,154
|
|
12,436
|
|
18,524
|
|
8,380
|
|
4,814
|
|
|||||
Solar asset financing obligations
(1)
|
18,866
|
|
2,719
|
|
5,438
|
|
5,438
|
|
5,271
|
|
|||||
Operating leases
(1)
|
51,073
|
|
2,387
|
|
5,239
|
|
5,156
|
|
38,291
|
|
|||||
Short-term debt
|
266,000
|
|
266,000
|
|
—
|
|
—
|
|
—
|
|
|||||
New Jersey Clean Energy Program
(1)
|
14,202
|
|
14,202
|
|
—
|
|
—
|
|
—
|
|
|||||
Construction obligations
|
23,120
|
|
23,120
|
|
—
|
|
—
|
|
—
|
|
|||||
Remediation expenditures
(2)
|
149,000
|
|
19,300
|
|
37,000
|
|
27,600
|
|
65,100
|
|
|||||
Natural gas supply purchase obligations-NJNG
|
94,720
|
|
51,050
|
|
43,670
|
|
—
|
|
—
|
|
|||||
Demand fee commitments-NJNG
|
1,187,054
|
|
98,586
|
|
244,959
|
|
197,125
|
|
646,384
|
|
|||||
Natural gas supply purchase obligations-Energy Services
|
445,066
|
|
296,491
|
|
137,087
|
|
11,488
|
|
—
|
|
|||||
Demand fee commitments-Energy Services
|
259,195
|
|
88,786
|
|
92,204
|
|
56,148
|
|
22,057
|
|
|||||
Total contractual cash obligations
|
$
|
4,101,176
|
|
$
|
1,059,846
|
|
$
|
741,593
|
|
$
|
417,029
|
|
$
|
1,882,708
|
|
(1)
|
These obligations include an interest component, as defined under the related governing agreements or in accordance with the applicable tax statute.
|
(2)
|
Expenditures are estimated, see
Note 14. Commitments and Contingent Liabilities
in the accompanying Consolidated Financial Statements
.
|
|
S&P
|
Moody’s
|
Corporate Rating
|
A
|
N/A
|
Commercial Paper
|
A-1
|
P-1
|
Senior Secured
|
A+
|
Aa2
|
Ratings Outlook
|
Stable
|
Stable
|
|
Balance
|
Increase
|
Less
|
Balance
|
||||||||||||
(Thousands)
|
September 30,
2016 |
(Decrease) in Fair
Market Value
|
Amounts
Settled
|
September 30,
2017 |
||||||||||||
NJNG
|
|
$
|
(2,485
|
)
|
|
$
|
5,288
|
|
|
$
|
3,952
|
|
|
$
|
(1,149
|
)
|
Energy Services
|
|
(21,742
|
)
|
|
19,703
|
|
|
3,513
|
|
|
(5,552
|
)
|
||||
Total
|
|
$
|
(24,227
|
)
|
|
$
|
24,991
|
|
|
$
|
7,465
|
|
|
$
|
(6,701
|
)
|
(Thousands)
|
2018
|
2019
|
2020 - 2022
|
After 2022
|
Total
Fair Value
|
|||||||||||||
Price based on NYMEX/CME
|
$
|
—
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Price based on ICE
|
(6,115
|
)
|
(736
|
)
|
|
147
|
|
|
3
|
|
|
(6,701
|
)
|
|||||
Total
|
$
|
(6,115
|
)
|
$
|
(736
|
)
|
|
$
|
147
|
|
|
$
|
3
|
|
|
$
|
(6,701
|
)
|
|
|
Volume Bcf
|
Price per MMBtu
(1)
|
Amounts included in Derivatives (Thousands)
|
||||
NJNG
|
Futures
|
18.2
|
|
$1.12-$3.33
|
|
$
|
(1,149
|
)
|
Energy Services
|
Futures
|
(16.4
|
)
|
$0.90-$5.30
|
|
(5,552
|
)
|
|
|
Options
|
—
|
|
|
|
|
||
Total
|
|
|
|
|
$
|
(6,701
|
)
|
(1)
|
Million British thermal unit
|
|
Balance
|
Increase
|
Less
|
Balance
|
||||||||||
(Thousands)
|
September 30,
2016 |
(Decrease) in Fair
Market Value
|
Amounts
Settled
|
September 30,
2017 |
||||||||||
NJNG - Prices based on other external data
|
|
$
|
(919
|
)
|
|
(10,096
|
)
|
|
(11,094
|
)
|
|
$
|
79
|
|
Energy Services - Prices based on other external data
|
|
(2,891
|
)
|
|
(11,765
|
)
|
|
(11,072
|
)
|
|
(3,584
|
)
|
||
Total
|
|
$
|
(3,810
|
)
|
|
(21,861
|
)
|
|
(22,166
|
)
|
|
$
|
(3,505
|
)
|
|
Balance
|
Increase
|
Less
|
Balance
|
||||||||||
(Thousands)
|
September 30, 2016
|
(Decrease) in Fair
Market Value
|
Amounts
Settled
|
September 30, 2017
|
||||||||||
NJNG - Prices based on other external data
|
|
$
|
(23,073
|
)
|
|
14,606
|
|
|
—
|
|
|
$
|
(8,467
|
)
|
|
Balance
|
Increase
|
Less
|
Balance
|
||||||||||
(Thousands)
|
September 30,
2016 |
(Decrease) in Fair
Market Value
|
Amounts
Settled
|
September 30,
2017 |
||||||||||
Energy Services
|
|
$
|
(31
|
)
|
|
43
|
|
|
(32
|
)
|
|
$
|
44
|
|
(Thousands)
|
2018
|
2019
|
2020 - 2022
|
|
After 2022
|
|
Total
Fair Value |
||||||||
Prices based on other external data
|
$
|
40
|
|
4
|
|
|
—
|
|
|
—
|
|
|
$
|
44
|
|
Derivative Fair Value Sensitivity Analysis
|
|
||||||||||||||
(Thousands)
|
Henry Hub Futures and Fixed Price Swaps
|
||||||||||||||
Percent increase in NYMEX natural gas futures prices
|
0%
|
5%
|
10%
|
15%
|
20%
|
||||||||||
Estimated change in derivative fair value
|
$
|
—
|
|
$
|
(8,844
|
)
|
$
|
(17,689
|
)
|
$
|
(26,534
|
)
|
$
|
(35,378
|
)
|
Ending derivative fair value
|
$
|
2,110
|
|
$
|
(6,734
|
)
|
$
|
(15,579
|
)
|
$
|
(24,424
|
)
|
$
|
(33,268
|
)
|
Percent decrease in NYMEX natural gas futures prices
|
0%
|
(5)%
|
(10)%
|
(15)%
|
(20)%
|
||||||||||
Estimated change in derivative fair value
|
$
|
—
|
|
$
|
8,844
|
|
$
|
17,689
|
|
$
|
26,534
|
|
$
|
35,378
|
|
Ending derivative fair value
|
$
|
2,110
|
|
$
|
10,954
|
|
$
|
19,799
|
|
$
|
28,644
|
|
$
|
37,488
|
|
(Thousands)
|
Gross Credit Exposure
|
Net Credit Exposure
|
||||||
Investment grade
|
|
$
|
133,431
|
|
|
$
|
100,703
|
|
Noninvestment grade
|
|
16,725
|
|
|
9,483
|
|
||
Internally-rated investment grade
|
|
16,282
|
|
|
14,069
|
|
||
Internally-rated noninvestment grade
|
|
48,960
|
|
|
4,886
|
|
||
Total
|
|
$
|
215,398
|
|
|
$
|
129,141
|
|
(Thousands)
|
Gross Credit Exposure
|
Net Credit Exposure
|
||||||
Investment grade
|
|
$
|
3,373
|
|
|
$
|
2,211
|
|
Noninvestment grade
|
|
164
|
|
|
—
|
|
||
Internally-rated investment grade
|
|
96
|
|
|
83
|
|
||
Internally-rated noninvestment grade
|
|
19,538
|
|
|
13,452
|
|
||
Total
|
|
$
|
23,171
|
|
|
$
|
15,746
|
|
•
|
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
|
•
|
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and
|
•
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.
|
(Thousands, except per share data)
|
|
|
|||||||
Fiscal years ended September 30,
|
2017
|
2016
|
2015
|
||||||
OPERATING REVENUES
|
|
|
|
||||||
Utility
|
$
|
695,637
|
|
$
|
594,346
|
|
$
|
781,970
|
|
Nonutility
|
1,572,980
|
|
1,286,559
|
|
1,952,017
|
|
|||
Total operating revenues
|
2,268,617
|
|
1,880,905
|
|
2,733,987
|
|
|||
OPERATING EXPENSES
|
|
|
|
||||||
Gas purchases:
|
|
|
|
||||||
Utility
|
258,687
|
|
205,034
|
|
304,953
|
|
|||
Nonutility
|
1,436,740
|
|
1,139,301
|
|
1,767,841
|
|
|||
Related parties
|
8,340
|
|
8,351
|
|
12,851
|
|
|||
Operation and maintenance
|
226,356
|
|
208,421
|
|
209,453
|
|
|||
Regulatory rider expenses
|
40,243
|
|
39,300
|
|
75,779
|
|
|||
Depreciation and amortization
|
81,841
|
|
72,748
|
|
61,399
|
|
|||
Energy and other taxes
|
49,366
|
|
40,215
|
|
53,260
|
|
|||
Total operating expenses
|
2,101,573
|
|
1,713,370
|
|
2,485,536
|
|
|||
OPERATING INCOME
|
167,044
|
|
167,535
|
|
248,451
|
|
|||
Other income, net
|
14,437
|
|
9,196
|
|
6,545
|
|
|||
Interest expense, net of capitalized interest
|
44,886
|
|
31,044
|
|
27,721
|
|
|||
INCOME BEFORE INCOME TAXES AND EQUITY IN EARNINGS OF AFFILIATES
|
136,595
|
|
145,687
|
|
227,275
|
|
|||
Income tax provision
|
18,343
|
|
23,530
|
|
59,724
|
|
|||
Equity in earnings of affiliates
|
13,813
|
|
9,515
|
|
13,409
|
|
|||
NET INCOME
|
$
|
132,065
|
|
$
|
131,672
|
|
$
|
180,960
|
|
|
|
|
|
||||||
EARNINGS PER COMMON SHARE
|
|
|
|
||||||
Basic
|
$1.53
|
$1.53
|
$2.12
|
||||||
Diluted
|
$1.52
|
$1.52
|
$2.10
|
||||||
DIVIDENDS DECLARED PER COMMON SHARE
|
$1.0375
|
$0.9750
|
$0.9150
|
||||||
WEIGHTED AVERAGE SHARES OUTSTANDING
|
|
|
|
||||||
Basic
|
86,321
|
|
85,884
|
|
85,186
|
|
|||
Diluted
|
87,144
|
|
86,731
|
|
86,265
|
|
(Thousands)
|
|
|
|
||||||
Fiscal years ended September 30,
|
2017
|
2016
|
2015
|
||||||
Net income
|
$
|
132,065
|
|
$
|
131,672
|
|
$
|
180,960
|
|
Other comprehensive income, net of tax:
|
|
|
|
||||||
Unrealized gain (loss) on available for sale securities, net of tax of $(4,401), $1,499, and $(1,135), respectively
(1)
|
6,846
|
|
(2,187
|
)
|
1,603
|
|
|||
Net unrealized gain on derivatives, net of tax of $0, $0 and $(56), respectively
|
—
|
|
—
|
|
93
|
|
|||
Adjustment to postemployment benefit obligation, net of tax of $(3,487), $2,466 and $3,688 respectively
|
5,053
|
|
(3,574
|
)
|
(5,496
|
)
|
|||
Other comprehensive income (loss)
|
11,899
|
|
(5,761
|
)
|
(3,800
|
)
|
|||
Comprehensive income
|
$
|
143,964
|
|
$
|
125,911
|
|
$
|
177,160
|
|
(1)
|
Available for sale securities are included in other noncurrent assets on the Consolidated Balance Sheets.
|
(Thousands)
|
|
|
|
|
|
||||||
Fiscal years ended September 30,
|
2017
|
|
2016
|
|
2015
|
||||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
||||||
Net income
|
$
|
132,065
|
|
|
$
|
131,672
|
|
|
$
|
180,960
|
|
Adjustments to reconcile net income to cash flows from operating activities
|
|
|
|
|
|
||||||
Unrealized (gain) loss on derivative instruments
|
(11,241
|
)
|
|
46,883
|
|
|
(38,681
|
)
|
|||
Gain on sale of property and available for sale securities, net
|
(7,287
|
)
|
|
—
|
|
|
—
|
|
|||
Depreciation and amortization
|
81,841
|
|
|
72,748
|
|
|
61,399
|
|
|||
Allowance for equity used during construction
|
(3,867
|
)
|
|
(4,375
|
)
|
|
(3,825
|
)
|
|||
Allowance for bad debt expense
|
2,023
|
|
|
1,616
|
|
|
2,859
|
|
|||
Deferred income taxes
|
41,442
|
|
|
27,721
|
|
|
45,934
|
|
|||
Manufactured gas plant remediation costs
|
(10,934
|
)
|
|
(8,106
|
)
|
|
(6,805
|
)
|
|||
Distributions received from equity investees, net of equity in earnings
|
(462
|
)
|
|
4,534
|
|
|
6,663
|
|
|||
Cost of removal - asset retirement obligations
|
(484
|
)
|
|
(403
|
)
|
|
(1,034
|
)
|
|||
Contributions to postemployment benefit plans
|
(6,077
|
)
|
|
(33,359
|
)
|
|
(5,778
|
)
|
|||
Tax benefit of delivered shares from stock based compensation
|
1,285
|
|
|
1,755
|
|
|
881
|
|
|||
Changes in:
|
|
|
|
|
|
||||||
Components of working capital
|
17,081
|
|
|
(123,325
|
)
|
|
81,817
|
|
|||
Other noncurrent assets
|
14,740
|
|
|
3,933
|
|
|
38,716
|
|
|||
Other noncurrent liabilities
|
(2,079
|
)
|
|
21,336
|
|
|
27,841
|
|
|||
Cash flows from operating activities
|
248,046
|
|
|
142,630
|
|
|
390,947
|
|
|||
CASH FLOWS (USED IN) INVESTING ACTIVITIES
|
|
|
|
|
|
||||||
Expenditures for:
|
|
|
|
|
|
||||||
Utility plant
|
(144,106
|
)
|
|
(176,067
|
)
|
|
(140,797
|
)
|
|||
Solar and wind equipment
|
(149,400
|
)
|
|
(149,063
|
)
|
|
(151,002
|
)
|
|||
Real estate properties and other
|
(2,434
|
)
|
|
(1,896
|
)
|
|
(209
|
)
|
|||
Cost of removal
|
(32,143
|
)
|
|
(29,066
|
)
|
|
(28,078
|
)
|
|||
Acquisition of retail and wholesale energy contracts
|
(55,661
|
)
|
|
—
|
|
|
—
|
|
|||
Investments in equity investees
|
(27,070
|
)
|
|
(11,176
|
)
|
|
(5,780
|
)
|
|||
Distributions from equity investees in excess of equity in earnings
|
2,749
|
|
|
2,351
|
|
|
2,620
|
|
|||
Withdrawal from (payment to) restricted cash construction fund
|
1,322
|
|
|
979
|
|
|
(1,499
|
)
|
|||
Proceeds from sale of investment
|
—
|
|
|
—
|
|
|
3,016
|
|
|||
Proceeds from sale of property
|
9,443
|
|
|
748
|
|
|
—
|
|
|||
Proceeds from sale of available for sale securities
|
6,639
|
|
|
—
|
|
|
—
|
|
|||
Cash flows (used in) investing activities
|
(390,661
|
)
|
|
(363,190
|
)
|
|
(321,729
|
)
|
|||
CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES
|
|
|
|
|
|
||||||
Proceeds from long-term debt
|
100,000
|
|
|
275,000
|
|
|
250,000
|
|
|||
Payments of long-term debt
|
(97,854
|
)
|
|
(13,289
|
)
|
|
(37,039
|
)
|
|||
Net proceeds from (payments of) short-term debt
|
144,300
|
|
|
55,350
|
|
|
(234,650
|
)
|
|||
Proceeds from sale-leaseback transaction - solar
|
32,901
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from sale-leaseback transaction - other
|
9,587
|
|
|
7,107
|
|
|
7,216
|
|
|||
Payments of common stock dividends
|
(87,988
|
)
|
|
(82,445
|
)
|
|
(76,532
|
)
|
|||
Proceeds from issuance of common stock
|
17,492
|
|
|
16,010
|
|
|
37,299
|
|
|||
Purchases of treasury stock
|
(6,355
|
)
|
|
(1,008
|
)
|
|
(10,589
|
)
|
|||
Tax withholding payments related to net settled stock compensation
|
(4,788
|
)
|
|
(3,547
|
)
|
|
(2,146
|
)
|
|||
Cash flows from (used in) financing activities
|
107,295
|
|
|
253,178
|
|
|
(66,441
|
)
|
|||
Change in cash and cash equivalents
|
(35,320
|
)
|
|
32,618
|
|
|
2,777
|
|
|||
Cash and cash equivalents at beginning of period
|
37,546
|
|
|
4,928
|
|
|
2,151
|
|
|||
Cash and cash equivalents at end of period
|
$
|
2,226
|
|
|
$
|
37,546
|
|
|
$
|
4,928
|
|
CHANGES IN COMPONENTS OF WORKING CAPITAL
|
|
|
|
|
|
||||||
Receivables
|
$
|
(56,974
|
)
|
|
$
|
11,303
|
|
|
$
|
32,529
|
|
Inventories
|
3,022
|
|
|
(45,986
|
)
|
|
114,638
|
|
|||
Recovery of gas costs
|
(90
|
)
|
|
(39,642
|
)
|
|
18,979
|
|
|||
Gas purchases payable
|
20,663
|
|
|
(11,963
|
)
|
|
(54,525
|
)
|
|||
Gas purchases payable - related parties
|
2
|
|
|
(411
|
)
|
|
202
|
|
|||
Prepaid and accrued taxes
|
10,366
|
|
|
2,385
|
|
|
(18,161
|
)
|
|||
Accounts payable and other
|
13,086
|
|
|
(15,656
|
)
|
|
(14,714
|
)
|
|||
Restricted broker margin accounts
|
22,570
|
|
|
(38,752
|
)
|
|
18,452
|
|
|||
Customers
’
credit balances and deposits
|
(5,877
|
)
|
|
12,044
|
|
|
(1,545
|
)
|
|||
Other current assets
|
10,313
|
|
|
3,353
|
|
|
(14,038
|
)
|
|||
Total
|
$
|
17,081
|
|
|
$
|
(123,325
|
)
|
|
$
|
81,817
|
|
SUPPLEMENTAL DISCLOSURES
|
|
|
|
|
|
||||||
Cash paid (received) for:
|
|
|
|
|
|
||||||
Interest (net of amounts capitalized)
|
$
|
44,362
|
|
|
$
|
31,996
|
|
|
$
|
24,208
|
|
Income taxes
|
$
|
(6,877
|
)
|
|
$
|
(3,516
|
)
|
|
$
|
28,790
|
|
Accrued capital expenditures
|
$
|
21,769
|
|
|
$
|
48,881
|
|
|
$
|
28,676
|
|
Deferred gain on non-cash exchange of investments
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24,601
|
|
See Notes to Consolidated Financial Statements
|
(Thousands)
|
|
|
||||
September 30,
|
2017
|
2016
|
||||
|
|
|
||||
PROPERTY, PLANT AND EQUIPMENT
|
|
|
||||
Utility plant, at cost
|
$
|
2,241,324
|
|
$
|
2,107,375
|
|
Construction work in progress
|
119,318
|
|
122,268
|
|
||
Solar and wind equipment, real estate properties and other, at cost
|
843,142
|
|
631,696
|
|
||
Construction work in progress
|
7,286
|
|
93,791
|
|
||
Total property, plant and equipment
|
3,211,070
|
|
2,955,130
|
|
||
Accumulated depreciation and amortization, utility plant
|
(489,122
|
)
|
(467,702
|
)
|
||
Accumulated depreciation and amortization, solar and wind equipment, real estate properties and other
|
(112,207
|
)
|
(79,776
|
)
|
||
Property, plant and equipment, net
|
2,609,741
|
|
2,407,652
|
|
||
|
|
|
||||
CURRENT ASSETS
|
|
|
||||
Cash and cash equivalents
|
2,226
|
|
37,546
|
|
||
Customer accounts receivable:
|
|
|
||||
Billed
|
196,467
|
|
142,658
|
|
||
Unbilled revenues
|
7,202
|
|
5,744
|
|
||
Allowance for doubtful accounts
|
(5,181
|
)
|
(4,865
|
)
|
||
Regulatory assets
|
50,791
|
|
54,286
|
|
||
Gas in storage, at average cost
|
202,063
|
|
206,251
|
|
||
Materials and supplies, at average cost
|
11,944
|
|
10,778
|
|
||
Prepaid and accrued taxes
|
24,764
|
|
34,179
|
|
||
Derivatives, at fair value
|
30,081
|
|
29,964
|
|
||
Restricted broker margin accounts
|
25,827
|
|
47,644
|
|
||
Asset held for sale
|
—
|
|
7,660
|
|
||
Other current assets
|
33,260
|
|
35,419
|
|
||
Total current assets
|
579,444
|
|
607,264
|
|
||
|
|
|
||||
NONCURRENT ASSETS
|
|
|
||||
Investments in equity investees
|
172,585
|
|
141,148
|
|
||
Regulatory assets
|
375,919
|
|
441,294
|
|
||
Derivatives, at fair value
|
9,164
|
|
5,227
|
|
||
Available for sale securities
|
65,752
|
|
55,789
|
|
||
Intangible assets
|
41,084
|
|
—
|
|
||
Other noncurrent assets
|
74,818
|
|
60,196
|
|
||
Total noncurrent assets
|
739,322
|
|
703,654
|
|
||
Total assets
|
$
|
3,928,507
|
|
$
|
3,718,570
|
|
(Thousands, except share data)
|
|
|
||||
September 30,
|
2017
|
2016
|
||||
|
|
|
||||
CAPITALIZATION
|
|
|
||||
Common stock, $2.50 par value; authorized 150,000,000 shares;
outstanding September 30, 2017 — 86,555,507; September 30, 2016 — 86,086,355 |
$
|
222,258
|
|
$
|
221,654
|
|
Premium on common stock
|
219,696
|
|
215,580
|
|
||
Accumulated other comprehensive (loss), net of tax
|
(3,256
|
)
|
(15,155
|
)
|
||
Treasury stock at cost and other;
shares September 30, 2017 — 2,347,380; September 30, 2016 — 2,575,139 |
(70,039
|
)
|
(81,044
|
)
|
||
Retained earnings
|
867,984
|
|
825,556
|
|
||
Common stock equity
|
1,236,643
|
|
1,166,591
|
|
||
Long-term debt
|
997,080
|
|
1,055,038
|
|
||
Total capitalization
|
2,233,723
|
|
2,221,629
|
|
||
|
|
|
||||
CURRENT LIABILITIES
|
|
|
||||
Current maturities of long-term debt
|
165,375
|
|
61,452
|
|
||
Short-term debt
|
266,000
|
|
121,700
|
|
||
Gas purchases payable
|
160,115
|
|
139,452
|
|
||
Gas purchases payable to related parties
|
1,152
|
|
1,150
|
|
||
Accounts payable and other
|
96,878
|
|
107,184
|
|
||
Dividends payable
|
23,586
|
|
21,975
|
|
||
Accrued taxes
|
2,031
|
|
1,080
|
|
||
Regulatory liabilities
|
78
|
|
9,469
|
|
||
New Jersey clean energy program
|
14,202
|
|
14,232
|
|
||
Derivatives, at fair value
|
46,544
|
|
61,080
|
|
||
Customers’ credit balances and deposits
|
26,957
|
|
32,834
|
|
||
Total current liabilities
|
802,918
|
|
571,608
|
|
||
|
|
|
||||
NONCURRENT LIABILITIES
|
|
|
||||
Deferred income taxes
|
514,708
|
|
473,847
|
|
||
Deferred investment tax credits
|
4,297
|
|
4,619
|
|
||
Deferred gain
|
27,728
|
|
28,519
|
|
||
Derivatives, at fair value
|
11,330
|
|
25,252
|
|
||
Manufactured gas plant remediation
|
149,000
|
|
172,000
|
|
||
Postemployment employee benefit liability
|
128,888
|
|
141,604
|
|
||
Regulatory liabilities
|
14,507
|
|
41,411
|
|
||
Asset retirement obligation
|
31,420
|
|
28,379
|
|
||
Other noncurrent liabilities
|
9,988
|
|
9,702
|
|
||
Total noncurrent liabilities
|
891,866
|
|
925,333
|
|
||
Commitments and contingent liabilities (Note 14)
|
|
|
|
|||
Total capitalization and liabilities
|
$
|
3,928,507
|
|
$
|
3,718,570
|
|
(Thousands)
|
Number of Shares
|
Common Stock
|
Premium on Common Stock
|
Accumulated Other Comprehensive (Loss) Income
|
Treasury Stock And Other
|
Retained Earnings
|
Total
|
|||||||||||||||
Balance at September 30, 2014
|
84,356
|
|
$
|
218,223
|
|
$
|
199,739
|
|
|
$
|
(5,594
|
)
|
|
$
|
(121,031
|
)
|
$
|
674,829
|
|
$
|
966,166
|
|
Net income
|
|
|
|
|
|
|
|
180,960
|
|
180,960
|
|
|||||||||||
Other comprehensive loss
|
|
|
|
|
(3,800
|
)
|
|
|
|
(3,800
|
)
|
|||||||||||
Common stock issued:
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Incentive compensation plan
|
359
|
|
895
|
|
5,013
|
|
|
|
|
|
|
5,908
|
|
|||||||||
Dividend reinvestment plan
(1)
|
1,149
|
|
1,720
|
|
6,722
|
|
|
|
|
19,096
|
|
|
27,538
|
|
||||||||
Tax benefits from stock plans
|
|
|
(1,344
|
)
|
|
|
|
|
|
(1,344
|
)
|
|||||||||||
Cash dividend declared ($.915 per share)
|
|
|
|
|
|
|
|
(78,044
|
)
|
(78,044
|
)
|
|||||||||||
Treasury stock and other
|
(333
|
)
|
|
(199
|
)
|
|
|
|
9,771
|
|
|
9,572
|
|
|||||||||
Balance at September 30, 2015
|
85,531
|
|
220,838
|
|
209,931
|
|
|
(9,394
|
)
|
|
(92,164
|
)
|
777,745
|
|
1,106,956
|
|
||||||
Net income
|
|
|
|
|
|
|
|
131,672
|
|
131,672
|
|
|||||||||||
Other comprehensive loss
|
|
|
|
|
(5,761
|
)
|
|
|
|
(5,761
|
)
|
|||||||||||
Common stock issued:
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Incentive compensation plan
|
325
|
|
816
|
|
8,583
|
|
|
|
|
|
|
9,399
|
|
|||||||||
Dividend reinvestment plan
(1)
|
471
|
|
|
(2,879
|
)
|
|
|
|
18,942
|
|
|
16,063
|
|
|||||||||
Cash dividend declared ($.975 per share)
|
|
|
|
|
|
|
|
(83,861
|
)
|
(83,861
|
)
|
|||||||||||
Treasury stock and other
|
(241
|
)
|
|
(55
|
)
|
|
|
|
(7,822
|
)
|
|
(7,877
|
)
|
|||||||||
Balance at September 30, 2016
|
86,086
|
|
221,654
|
|
215,580
|
|
|
(15,155
|
)
|
|
(81,044
|
)
|
825,556
|
|
1,166,591
|
|
||||||
Net income
|
|
|
|
|
|
|
|
132,065
|
|
132,065
|
|
|||||||||||
Other comprehensive income
|
|
|
|
|
11,899
|
|
|
|
|
11,899
|
|
|||||||||||
Common stock issued:
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Incentive compensation plan
|
241
|
|
604
|
|
5,090
|
|
|
|
|
|
|
5,694
|
|
|||||||||
Dividend reinvestment plan
(1)
|
472
|
|
|
(946
|
)
|
|
|
|
18,568
|
|
|
17,622
|
|
|||||||||
Cash dividend declared ($1.0375 per share)
|
|
|
|
|
|
|
|
(89,637
|
)
|
(89,637
|
)
|
|||||||||||
Treasury stock and other
|
(243
|
)
|
|
(28
|
)
|
|
|
|
(7,563
|
)
|
|
(7,591
|
)
|
|||||||||
Balance at September 30, 2017
|
86,556
|
|
$
|
222,258
|
|
$
|
219,696
|
|
|
$
|
(3,256
|
)
|
|
$
|
(70,039
|
)
|
$
|
867,984
|
|
$
|
1,236,643
|
|
(1)
|
The DRP allows NJR, at its option, to use newly issued shares to raise capital. During fiscal
2015
, NJR issued approximately
688,000
new shares through the waiver discount feature of its DRP. There were
no
new shares issued through the waiver discount feature during
fiscal
2016
and
fiscal 2017
.
|
|
2017
|
2016
|
||||||||||
($ in thousands)
|
Gas in Storage
|
|
Bcf
|
Gas in Storage
|
|
Bcf
|
||||||
Energy Services
|
|
$
|
122,884
|
|
53.9
|
|
|
$
|
130,493
|
|
62.0
|
|
Natural Gas Distribution
|
|
79,179
|
|
21.8
|
|
|
75,758
|
|
21.3
|
|
||
Total
|
|
$
|
202,063
|
|
75.7
|
|
|
$
|
206,251
|
|
83.3
|
|
(Millions)
|
2017
|
2016
|
2015
|
||||||
Energy Services
|
$
|
126.4
|
|
$
|
141.0
|
|
$
|
130.6
|
|
Natural Gas Distribution
|
80.2
|
|
77.8
|
|
80.5
|
|
|||
Total
|
$
|
206.6
|
|
$
|
218.8
|
|
$
|
211.1
|
|
($ in thousands)
|
2017
|
2016
|
2015
|
||||||
AFUDC:
|
|
|
|
||||||
Debt
|
$
|
1,311
|
|
$
|
5,009
|
|
$
|
2,472
|
|
Equity
|
3,867
|
|
4,375
|
|
3,825
|
|
|||
Total
|
$
|
5,178
|
|
$
|
9,384
|
|
$
|
6,297
|
|
Weighted average interest rate
|
6.90
|
%
|
5.06
|
%
|
4.63
|
%
|
(Thousands)
|
2017
|
|
2016
|
||||||||
Energy Services
|
$
|
150,322
|
|
77
|
%
|
|
$
|
102,884
|
|
72
|
%
|
NJNG
(1)
|
37,432
|
|
19
|
|
|
30,951
|
|
22
|
|
||
Clean Energy Ventures
|
2,655
|
|
1
|
|
|
1,807
|
|
1
|
|
||
NJRHS and other
|
6,058
|
|
3
|
|
|
7,016
|
|
5
|
|
||
Total
|
$
|
196,467
|
|
100
|
%
|
|
$
|
142,658
|
|
100
|
%
|
(1)
|
Does not include unbilled revenues of
$7.2 million
and
$5.7 million
as of
September 30, 2017
and
2016
, respectively.
|
(Thousands)
|
Unrealized gain (loss) on available for sale securities
|
Net unrealized gain (loss) on derivatives
|
Adjustment to postemployment benefit obligation
|
Total
|
|||||||||||
Balance as of September 30, 2015
|
$
|
6,385
|
|
|
$
|
—
|
|
|
$
|
(15,779
|
)
|
|
$
|
(9,394
|
)
|
Other comprehensive income, net of tax
|
|
|
|
|
|
|
|
||||||||
Other comprehensive (loss), before reclassifications, net of tax of $1,499, $10, $3,164, $4,673
|
(2,187
|
)
|
|
(17
|
)
|
|
(4,600
|
)
|
|
(6,804
|
)
|
||||
Amounts reclassified from accumulated other comprehensive income, net of tax of $0, $(10), $(698), $(708)
|
—
|
|
|
17
|
|
(1)
|
1,026
|
|
(2)
|
1,043
|
|
||||
Net current-period other comprehensive (loss), net of tax of $1,499, $0, $2,466, $3,965
|
(2,187
|
)
|
|
—
|
|
|
(3,574
|
)
|
|
(5,761
|
)
|
||||
Balance at September 30, 2016
|
$
|
4,198
|
|
|
$
|
—
|
|
|
$
|
(19,353
|
)
|
|
$
|
(15,155
|
)
|
Other comprehensive income, net of tax
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income, before reclassifications, net of tax of $(6,593), $0, $(2,619), $(9,212)
|
10,019
|
|
|
—
|
|
|
3,783
|
|
|
13,802
|
|
||||
Amounts reclassified from accumulated other comprehensive (loss) income, net of tax of $2,192, $0, $(868), $1,324
|
(3,173
|
)
|
|
—
|
|
(1)
|
1,270
|
|
(2)
|
(1,903
|
)
|
||||
Net current-period other comprehensive income, net of tax of $(4,401), $0, $(3,487), $(7,888)
|
6,846
|
|
|
—
|
|
|
5,053
|
|
|
11,899
|
|
||||
Balance at September 30, 2017
|
$
|
11,044
|
|
|
$
|
—
|
|
|
$
|
(14,300
|
)
|
|
$
|
(3,256
|
)
|
(1)
|
Consists of realized losses related to foreign currency derivatives, which are reclassified to gas purchases on the Consolidated Statements of Operations.
|
(2)
|
Included in the computation of net periodic pension cost, a component of O&M expense on the Consolidated Statements of Operations. For more details, see
Note 11. Employee Benefit Plans
.
|
(Thousands)
|
As Previously Reported
|
|
Effect of Change
|
|
As Adjusted
|
||||||
Assets
|
|
|
|
|
|
||||||
Other noncurrent assets
|
$
|
68,708
|
|
|
$
|
(8,512
|
)
|
|
$
|
60,196
|
|
Total noncurrent assets
|
$
|
712,166
|
|
|
$
|
(8,512
|
)
|
|
$
|
703,654
|
|
Total assets
|
$
|
3,727,082
|
|
|
$
|
(8,512
|
)
|
|
$
|
3,718,570
|
|
Capitalization and Liabilities
|
|
|
|
|
|
||||||
Long-term debt
|
$
|
1,063,550
|
|
|
$
|
(8,512
|
)
|
|
$
|
1,055,038
|
|
Total capitalization
|
$
|
2,230,141
|
|
|
$
|
(8,512
|
)
|
|
$
|
2,221,629
|
|
Total capitalization and liabilities
|
$
|
3,727,082
|
|
|
$
|
(8,512
|
)
|
|
$
|
3,718,570
|
|
(Thousands)
|
Estimated Fair Value
|
||
Total purchase price consideration transferred
|
$
|
55,661
|
|
Identifiable assets acquired
|
|
||
Wholesale energy contracts
(1)
|
$
|
41,846
|
|
Retail energy contracts
(2)
|
13,815
|
|
|
Net assets acquired
|
$
|
55,661
|
|
(1)
|
Wholesale energy contracts are presented within Intangible assets, net on the Consolidated Balance Sheets.
|
(2)
|
Retail energy contracts are presented within the Derivatives, at fair value line items on the Consolidated Balance Sheets.
|
(Thousands)
|
2017
|
2016
|
||||
Regulatory assets-current
|
|
|
||||
Conservation Incentive Program
|
$
|
17,669
|
|
$
|
36,957
|
|
New Jersey Clean Energy Program
|
14,202
|
|
14,232
|
|
||
Underrecovered gas costs
|
9,910
|
|
—
|
|
||
Derivatives at fair value, net
|
9,010
|
|
3,097
|
|
||
Total current regulatory assets
|
$
|
50,791
|
|
$
|
54,286
|
|
Regulatory assets-noncurrent
|
|
|
||||
Environmental remediation costs:
|
|
|
||||
Expended, net of recoveries
|
$
|
28,547
|
|
$
|
19,595
|
|
Liability for future expenditures
|
149,000
|
|
172,000
|
|
||
Deferred income taxes
|
21,795
|
|
20,273
|
|
||
Derivatives at fair value, net
|
—
|
|
23,384
|
|
||
SAVEGREEN
|
16,302
|
|
25,208
|
|
||
Postemployment and other benefit costs
|
141,433
|
|
157,027
|
|
||
Deferred Superstorm Sandy costs
|
13,030
|
|
15,201
|
|
||
Other noncurrent regulatory assets
|
5,812
|
|
8,606
|
|
||
Total noncurrent regulatory assets
|
$
|
375,919
|
|
$
|
441,294
|
|
Regulatory liability-current
|
|
|
||||
Derivatives at fair value, net
|
78
|
|
—
|
|
||
Overrecovered gas costs
|
—
|
|
9,469
|
|
||
Total current regulatory liabilities
|
$
|
78
|
|
$
|
9,469
|
|
Regulatory liabilities-noncurrent
|
|
|
||||
Cost of removal obligation
|
$
|
7,902
|
|
$
|
30,549
|
|
New Jersey Clean Energy Program
|
5,795
|
|
10,657
|
|
||
Other noncurrent regulatory liabilities
|
664
|
|
205
|
|
||
Derivatives at fair value, net
|
146
|
|
—
|
|
||
Total noncurrent regulatory liabilities
|
$
|
14,507
|
|
$
|
41,411
|
|
•
|
June 2015 BGSS/CIP filing
—
In
February 2016
, the BPU approved NJNG’s proposal to continue its existing BGSS rate and to increase its CIP rates resulting in a
$1.1 million
annual recovery increase, effective
October 2015
. NJNG also provided bill credits to residential and small commercial customers from November 2015 through February 2016, as a result of the decline in the wholesale price of natural gas, which totaled
$61.6 million
.
|
•
|
June 2016 BGSS/CIP filing
—
In
September 2016
, the BPU approved NJNG's filing to increase its CIP rates resulting in a
$43.9 million
annual recovery increase and to decrease its annual BGSS rate for residential and small commercial customers resulting in a
$22.6 million
annual recovery decrease, effective
October 2016
. This petition also included proposed bill credits to residential and small commercial customers during the months of November 2016 through February 2017, as a result of a decline in the wholesale price of natural gas. In
September 2016
, NJNG notified the BPU that the estimated bill credits would be approximately
$48 million
; however, customer usage was lower due to warmer weather during winter months and therefore, a total of
$42 million
in bill credits were issued during fiscal 2017.
|
•
|
June 2017 BGSS/CIP filing
—
On
September 22, 2017
, the BPU provisionally approved NJNG's petition to maintain its BGSS rate for residential and small commercial customers, increase its balancing charge rate, which will result in a
$3.7 million
increase to the annual revenues credited to BGSS and decrease its CIP rates, which will result in a
$16.2 million
annual recovery decrease, effective
October 2017
.
|
•
|
2015 SBC filings
—
In
September 2015
, the BPU approved the annual USF compliance filing decreasing the statewide USF rate, resulting in an annual
$3.9 million
decrease to USF recoveries, effective
October 2015
. In
June 2016
, the BPU approved NJNG's additional filing to recover remediation expenses incurred through
June 30, 2015
, increase the RAC with an annual recovery of
$9.4 million
and to decrease the NJCEP factor, effective
July 9, 2016
.
|
•
|
2016 SBC filing
—
In
September 2016
, the BPU approved NJNG's annual USF compliance filing proposing to increase the statewide USF rate, resulting in a
$1.3 million
annual increase in USF recoveries, effective
October 2016
.
|
•
|
2017 SBC filing
—
On
September 22, 2017
, the BPU approved NJNG's annual USF compliance filing to decrease the statewide USF rate, which will result in a
$2.6 million
annual decrease, effective
October 1, 2017
. On
November 17, 2017
, NJNG filed it's annual SBC application requesting to recover remediation expenses incurred through June 30, 2017, a reduction in the RAC, which will decrease the annual recovery to
$7 million
and to increase the NJCEP factor, effective
April 1, 2018
.
|
|
|
|
Fair Value
|
||||||||||||||
|
|
|
2017
|
|
2016
|
||||||||||||
(Thousands)
|
Balance Sheet Location
|
Asset
Derivatives
|
Liability
Derivatives
|
Asset
Derivatives
|
Liability
Derivatives
|
||||||||||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|||||||||
NJNG:
|
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
Derivatives - current
|
|
$
|
151
|
|
|
$
|
72
|
|
|
$
|
235
|
|
|
$
|
1,154
|
|
Financial commodity contracts
|
Derivatives - current
|
|
—
|
|
|
1,149
|
|
|
805
|
|
|
2,979
|
|
||||
|
Derivatives - noncurrent
|
|
—
|
|
|
—
|
|
|
75
|
|
|
386
|
|
||||
Interest rate contracts
|
Derivatives - current
|
|
—
|
|
|
8,467
|
|
|
—
|
|
|
—
|
|
||||
Interest rate contracts
|
Derivatives - noncurrent
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23,073
|
|
||||
Energy Services:
|
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
Derivatives - current
|
|
14,588
|
|
|
16,589
|
|
|
5,994
|
|
|
11,660
|
|
||||
|
Derivatives - noncurrent
|
|
7,127
|
|
|
8,710
|
|
|
3,987
|
|
|
1,212
|
|
||||
Financial commodity contracts
|
Derivatives - current
|
|
15,302
|
|
|
20,267
|
|
|
22,929
|
|
|
45,255
|
|
||||
|
Derivatives - noncurrent
|
|
2,033
|
|
|
2,620
|
|
|
1,165
|
|
|
581
|
|
||||
Foreign currency contracts
|
Derivatives - current
|
|
40
|
|
|
—
|
|
|
1
|
|
|
32
|
|
||||
|
Derivatives - noncurrent
|
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total fair value of derivatives
|
|
|
$
|
39,245
|
|
|
$
|
57,874
|
|
|
$
|
35,191
|
|
|
$
|
86,332
|
|
(Thousands)
|
Amounts Presented in Balance Sheets
(1)
|
Offsetting Derivative Instruments
(2)
|
Financial Collateral Received/Pledged
(3)
|
Net Amounts
(4)
|
||||||||||||
As of September 30, 2017:
|
|
|
|
|
|
|
|
|
||||||||
Derivative assets:
|
|
|
|
|
|
|
|
|
||||||||
Energy Services
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
21,715
|
|
|
$
|
(2,173
|
)
|
|
$
|
(200
|
)
|
|
$
|
19,342
|
|
Financial commodity contracts
|
|
17,335
|
|
|
(14,121
|
)
|
|
—
|
|
|
3,214
|
|
||||
Foreign currency contracts
|
|
44
|
|
|
—
|
|
|
—
|
|
|
44
|
|
||||
Total Energy Services
|
|
$
|
39,094
|
|
|
$
|
(16,294
|
)
|
|
$
|
(200
|
)
|
|
$
|
22,600
|
|
NJNG
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
151
|
|
|
$
|
(20
|
)
|
|
$
|
—
|
|
|
$
|
131
|
|
Financial commodity contracts
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Interest rate contracts
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total NJNG
|
|
$
|
151
|
|
|
$
|
(20
|
)
|
|
$
|
—
|
|
|
$
|
131
|
|
Derivative liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Energy Services
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
25,299
|
|
|
$
|
(2,173
|
)
|
|
$
|
—
|
|
|
$
|
23,126
|
|
Financial commodity contracts
|
|
22,887
|
|
|
(14,121
|
)
|
|
(8,766
|
)
|
|
—
|
|
||||
Foreign currency contracts
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total Energy Services
|
|
$
|
48,186
|
|
|
$
|
(16,294
|
)
|
|
$
|
(8,766
|
)
|
|
$
|
23,126
|
|
NJNG
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
72
|
|
|
$
|
(20
|
)
|
|
$
|
—
|
|
|
$
|
52
|
|
Financial commodity contracts
|
|
1,149
|
|
|
—
|
|
|
(1,149
|
)
|
|
—
|
|
||||
Interest rate contracts
|
|
8,467
|
|
|
—
|
|
|
—
|
|
|
8,467
|
|
||||
Total NJNG
|
|
$
|
9,688
|
|
|
$
|
(20
|
)
|
|
$
|
(1,149
|
)
|
|
$
|
8,519
|
|
As of September 30, 2016:
|
|
|
|
|
|
|
|
|
||||||||
Derivative assets:
|
|
|
|
|
|
|
|
|
||||||||
Energy Services
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
9,981
|
|
|
$
|
(2,837
|
)
|
|
$
|
(755
|
)
|
|
$
|
6,389
|
|
Financial commodity contracts
|
|
24,094
|
|
|
(17,945
|
)
|
|
(6,149
|
)
|
|
—
|
|
||||
Foreign currency contracts
|
|
1
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
||||
Total Energy Services
|
|
$
|
34,076
|
|
|
$
|
(20,783
|
)
|
|
$
|
(6,904
|
)
|
|
$
|
6,389
|
|
NJNG
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
235
|
|
|
$
|
(31
|
)
|
|
$
|
—
|
|
|
$
|
204
|
|
Financial commodity contracts
|
|
880
|
|
|
(880
|
)
|
|
—
|
|
|
—
|
|
||||
Interest rate contracts
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total NJNG
|
|
$
|
1,115
|
|
|
$
|
(911
|
)
|
|
$
|
—
|
|
|
$
|
204
|
|
Derivative liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Energy Services
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
12,872
|
|
|
$
|
(2,837
|
)
|
|
$
|
1,200
|
|
|
$
|
11,235
|
|
Financial commodity contracts
|
|
45,836
|
|
|
(17,945
|
)
|
|
(27,891
|
)
|
|
—
|
|
||||
Foreign currency contracts
|
|
32
|
|
|
(1
|
)
|
|
—
|
|
|
31
|
|
||||
Total Energy Services
|
|
$
|
58,740
|
|
|
$
|
(20,783
|
)
|
|
$
|
(26,691
|
)
|
|
$
|
11,266
|
|
NJNG
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
1,154
|
|
|
$
|
(31
|
)
|
|
$
|
—
|
|
|
$
|
1,123
|
|
Financial commodity contracts
|
|
3,365
|
|
|
(880
|
)
|
|
(2,485
|
)
|
|
—
|
|
||||
Interest rate contracts
|
|
23,073
|
|
|
—
|
|
|
—
|
|
|
23,073
|
|
||||
Total NJNG
|
|
$
|
27,592
|
|
|
$
|
(911
|
)
|
|
$
|
(2,485
|
)
|
|
$
|
24,196
|
|
(1)
|
Derivative assets and liabilities are presented on a gross basis in the balance sheet as the Company does not elect balance sheet offsetting under ASC 210-20.
|
(2)
|
Offsetting derivative instruments include transactions with NAESB netting election, transactions held by FCMs with net margining and transactions with ISDA netting.
|
(3)
|
Financial collateral includes cash balances at FCMs, as well as cash received from or pledged to other counterparties.
|
(4)
|
Net amounts represent presentation of derivative assets and liabilities if the Company were to elect balance sheet offsetting under ASC 210-20.
|
(Thousands)
|
Location of gain (loss) recognized in income on derivatives
|
Amount of gain (loss) recognized
in income on derivatives
|
||||||||||
Derivatives not designated as hedging instruments:
|
2017
|
|
2016
|
|
2015
|
|||||||
Energy Services:
|
|
|
|
|
|
|
||||||
Physical commodity contracts
|
Operating revenues
|
$
|
8,912
|
|
|
$
|
33,034
|
|
|
$
|
32,568
|
|
Physical commodity contracts
|
Gas purchases
|
(27,461
|
)
|
|
(45,637
|
)
|
|
(34,438
|
)
|
|||
Financial commodity contracts
|
Gas purchases
|
26,563
|
|
|
45,579
|
|
|
109,082
|
|
|||
Foreign currency contracts
|
Gas purchases
|
41
|
|
|
(34
|
)
|
|
—
|
|
|||
Total unrealized and realized gains (losses)
|
$
|
8,055
|
|
|
$
|
32,942
|
|
|
$
|
107,212
|
|
(Thousands)
|
2017
|
|
2016
|
|
2015
|
||||||
NJNG:
|
|
|
|
|
|
||||||
Physical commodity contracts
|
$
|
(12,303
|
)
|
|
$
|
(15,756
|
)
|
|
$
|
—
|
|
Financial commodity contracts
|
5,595
|
|
|
(7,984
|
)
|
|
(33,428
|
)
|
|||
Interest rate contracts
|
14,606
|
|
|
(18,845
|
)
|
|
(4,228
|
)
|
|||
Total unrealized and realized (losses) gains
|
$
|
7,898
|
|
|
$
|
(42,585
|
)
|
|
$
|
(37,656
|
)
|
|
|
|
Volume (Bcf)
|
||||
|
|
|
2017
|
|
2016
|
||
NJNG
|
Futures
|
|
18.2
|
|
|
23.6
|
|
|
Physical
|
|
32.1
|
|
|
9.2
|
|
Energy Services
|
Futures
|
|
(16.4
|
)
|
|
(79.1
|
)
|
|
Financial Options
|
|
—
|
|
|
1.2
|
|
|
Physical
|
|
(13.1
|
)
|
|
94.6
|
|
(Thousands)
|
Balance Sheet Location
|
2017
|
2016
|
||||
NJNG
|
Broker margin - Current assets
|
$
|
2,661
|
|
$
|
4,822
|
|
Energy Services
|
Broker margin - Current assets
|
$
|
23,166
|
|
$
|
42,822
|
|
(Thousands)
|
Gross Credit
Exposure
|
||||
Investment grade
|
|
$
|
136,804
|
|
|
Noninvestment grade
|
|
16,889
|
|
|
|
Internally-rated investment grade
|
|
16,378
|
|
|
|
Internally-rated noninvestment grade
|
|
68,498
|
|
|
|
Total
|
|
$
|
238,569
|
|
|
(Thousands)
|
2017
|
2016
|
||||
NJNG
|
|
|
||||
Carrying value
(1) (2)
|
$
|
672,045
|
|
$
|
707,845
|
|
Fair market value
|
$
|
673,051
|
|
$
|
731,615
|
|
NJR
|
|
|
||||
Carrying value
(3)
|
$
|
425,000
|
|
$
|
375,000
|
|
Fair market value
|
$
|
434,625
|
|
$
|
399,462
|
|
(1)
|
Excludes
capital leases of
$39.7 million
and
$42.2 million
as of
September 30, 2017
and
2016
, respectively.
|
(2)
|
Excludes debt issuance costs
of
$6.3 million
and
$7.7 million
as of
September 30, 2017
and
2016
, respectively.
|
(3)
|
Excludes debt issuance costs
of
$770,000
and
$853,000
as of
September 30, 2017
and
2016
, respectively.
|
Level 1
|
Unadjusted quoted prices for identical assets or liabilities in active markets. The Company’s Level 1 assets and liabilities include exchange traded natural gas futures and options contracts, listed equities and money market funds.
Exchange traded futures and options contracts include all energy contracts traded on the NYMEX, CME and ICE that the Company refers internally to as basis swaps, fixed swaps, futures and financial options that are cleared through a FCM.
|
Level 2
|
Other significant observable inputs, such as interest rates or
price data, including both commodity and basis pricing that is observed either directly or indirectly from publications or pricing services. The Company’s Level 2 assets and liabilities include over-the-counter physical forward commodity contracts and swap contracts, SREC forward sales or derivatives that are initially valued using observable quotes and are subsequently adjusted to include time value, credit risk or estimated transport pricing components for which no basis price is available.
Level 2 financial derivatives consist of transactions with non-FCM counterparties (basis swaps, fixed swaps and/or options). NJNG’s treasury lock is also considered Level 2 as valuation is based on quoted market interest and swap rates as inputs to the valuation model. Inputs are verifiable and do not require significant management judgment. For some physical commodity contracts, the Company utilizes transportation tariff rates that are publicly available and that it considers to be observable inputs that are equivalent to market data received from an independent source. There are no significant judgments or adjustments applied to the transportation tariff inputs and no market perspective is required. Even if the transportation tariff input were considered to be a “model,” it would still be considered to be a Level 2 input as the data is:
|
•
|
widely accepted and public;
|
•
|
non-proprietary and sourced from an independent third party; and
|
•
|
observable and published.
|
Level 3
|
Inputs derived from a significant amount of unobservable market data. These include the Company’s best estimate of fair value and are derived primarily through the use of internal valuation methodologies.
|
|
Quoted Prices in Active Markets for Identical Assets
|
Significant Other Observable Inputs
|
Significant
Unobservable
Inputs
|
|
||||||||||||||
(Thousands)
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
Total
|
||||||||||||||
As of September 30, 2017:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
—
|
|
|
|
$
|
21,866
|
|
|
|
$
|
—
|
|
|
$
|
21,866
|
|
Financial commodity contracts
|
|
17,335
|
|
|
|
—
|
|
|
|
—
|
|
|
17,335
|
|
||||
Financial commodity contracts - foreign exchange
|
|
—
|
|
|
|
44
|
|
|
|
—
|
|
|
44
|
|
||||
Available for sale equity securities
|
|
65,752
|
|
|
|
—
|
|
|
|
—
|
|
|
65,752
|
|
||||
Money market funds
|
|
112
|
|
|
|
—
|
|
|
|
—
|
|
|
112
|
|
||||
Other
|
|
1,090
|
|
|
|
—
|
|
|
|
—
|
|
|
1,090
|
|
||||
Total assets at fair value
|
|
$
|
84,289
|
|
|
|
$
|
21,910
|
|
|
|
$
|
—
|
|
|
$
|
106,199
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
—
|
|
|
|
$
|
25,371
|
|
|
|
$
|
—
|
|
|
$
|
25,371
|
|
Financial commodity contracts
|
|
24,036
|
|
|
|
—
|
|
|
|
—
|
|
|
24,036
|
|
||||
Financial commodity contracts - foreign exchange
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
||||
Interest rate contracts
|
|
—
|
|
|
|
8,467
|
|
|
|
—
|
|
|
8,467
|
|
||||
Total liabilities at fair value
|
|
$
|
24,036
|
|
|
|
$
|
33,838
|
|
|
|
$
|
—
|
|
|
$
|
57,874
|
|
As of September 30, 2016:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
—
|
|
|
|
$
|
10,216
|
|
|
|
$
|
—
|
|
|
$
|
10,216
|
|
Financial commodity contracts
|
|
24,974
|
|
|
|
—
|
|
|
|
—
|
|
|
24,974
|
|
||||
Financial commodity contracts - foreign exchange
|
|
—
|
|
|
|
1
|
|
|
|
—
|
|
|
1
|
|
||||
Available for sale equity securities
|
|
55,789
|
|
|
|
—
|
|
|
|
—
|
|
|
55,789
|
|
||||
Money market funds
|
|
34,072
|
|
|
|
—
|
|
|
|
—
|
|
|
34,072
|
|
||||
Other
|
|
1,444
|
|
|
|
—
|
|
|
|
—
|
|
|
1,444
|
|
||||
Total assets at fair value
|
|
$
|
116,279
|
|
|
|
$
|
10,217
|
|
|
|
$
|
—
|
|
|
$
|
126,496
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
—
|
|
|
|
$
|
14,026
|
|
|
|
$
|
—
|
|
|
$
|
14,026
|
|
Financial commodity contracts
|
|
49,201
|
|
|
|
—
|
|
|
|
—
|
|
|
49,201
|
|
||||
Financial commodity contracts - foreign exchange
|
|
—
|
|
|
|
32
|
|
|
|
—
|
|
|
32
|
|
||||
Interest rate contracts
|
|
—
|
|
|
|
23,073
|
|
|
|
—
|
|
|
23,073
|
|
||||
Total liabilities at fair value
|
|
$
|
49,201
|
|
|
|
$
|
37,131
|
|
|
|
$
|
—
|
|
|
$
|
86,332
|
|
|
Quoted Prices in Active Markets for Identical Assets
|
Significant Other Observable Inputs
|
Significant
Unobservable
Inputs
|
|
||||||||||||||
(Thousands)
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
Total
|
||||||||||||||
As of September 30, 2017:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
||||||||
Acquired wholesale energy contracts
(1)
|
|
$
|
—
|
|
|
|
$
|
41,084
|
|
|
|
$
|
—
|
|
|
$
|
41,084
|
|
Total assets at fair value
|
|
$
|
—
|
|
|
|
$
|
41,084
|
|
|
|
$
|
—
|
|
|
$
|
41,084
|
|
(1)
|
Included in intangible asset on the Consolidated Balance Sheets, see
Note 3. Acquisition
for more information regarding the acquired contracts.
|
(Thousands)
|
2017
|
2016
|
||||
Steckman Ridge
(1)
|
$
|
120,262
|
|
$
|
123,155
|
|
PennEast
|
52,323
|
|
17,993
|
|
||
Total
|
$
|
172,585
|
|
$
|
141,148
|
|
(Thousands, except per share amounts)
|
2017
|
2016
|
2015
|
||||||
Net income, as reported
|
$
|
132,065
|
|
$
|
131,672
|
|
$
|
180,960
|
|
Basic earnings per share
|
|
|
|
||||||
Weighted average shares of common stock outstanding-basic
|
86,321
|
|
85,884
|
|
85,186
|
|
|||
Basic earnings per common share
|
$1.53
|
$1.53
|
$2.12
|
||||||
Diluted earnings per share
|
|
|
|
||||||
Weighted average shares of common stock outstanding-basic
|
86,321
|
|
85,884
|
|
85,186
|
|
|||
Incremental shares
(1)
|
823
|
|
847
|
|
1,079
|
|
|||
Weighted average shares of common stock outstanding-diluted
|
87,144
|
|
86,731
|
|
86,265
|
|
|||
Diluted earnings per common share
(2)
|
$1.52
|
$1.52
|
$2.10
|
(1)
|
Incremental shares consist primarily of unvested stock awards and performance units.
|
(2)
|
There were
no
anti-dilutive shares excluded from the calculation of diluted earnings per share for
fiscal 2017
,
2016
and
2015
.
|
(Thousands)
|
NJNG
|
NJR
|
||||
2018
|
$
|
125,000
|
|
$
|
25,000
|
|
2019
|
$
|
—
|
|
$
|
100,000
|
|
2020
|
$
|
—
|
|
$
|
—
|
|
2021
|
$
|
—
|
|
$
|
—
|
|
2022
|
$
|
—
|
|
$
|
50,000
|
|
Thereafter
|
$
|
547,045
|
|
$
|
250,000
|
|
(Thousands)
|
Lease Payments
|
|
||
2018
|
|
$
|
12,436
|
|
2019
|
|
9,675
|
|
|
2020
|
|
8,849
|
|
|
2021
|
|
5,862
|
|
|
2022
|
|
2,518
|
|
|
Thereafter
|
|
4,914
|
|
|
Subtotal
|
|
44,200
|
|
|
Less: Interest component
|
|
(4,494
|
)
|
|
Total
|
|
$
|
39,700
|
|
(Thousands)
|
2017
|
|
2016
|
||||
NJR
|
|
|
|
||||
Bank revolving credit facilities:
(1)
|
$
|
425,000
|
|
|
$
|
425,000
|
|
Notes outstanding at end of period
|
$
|
255,000
|
|
|
$
|
121,700
|
|
Weighted average interest rate at end of period
|
2.14
|
%
|
|
1.43
|
%
|
||
Amount available at end of period
(2)
|
$
|
156,601
|
|
|
$
|
288,910
|
|
NJNG
|
|
|
|
||||
Bank revolving credit facilities:
(3)
|
$
|
250,000
|
|
|
$
|
250,000
|
|
Commercial paper outstanding at end of period
|
$
|
11,000
|
|
|
$
|
—
|
|
Weighted average interest rate at end of period
|
1.13
|
%
|
|
—
|
%
|
||
Amount available at end of period
(4)
|
$
|
238,269
|
|
|
$
|
249,269
|
|
(1)
|
Committed credit facilities, which require commitment fees of
.075 percent
on the unused amounts.
|
(2)
|
Letters of credit outstanding total
$13.4 million
and
$14.4 million
as of
September 30, 2017
and
2016
, respectively, which reduces amount available by the same amount.
|
(3)
|
Committed credit facilities, which require commitment fees of
.075 percent
on the unused amounts.
|
(4)
|
Letters of credit outstanding total
$731,000
as of
September 30, 2017
and
2016
, which reduces amount available by the same amount.
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Stock-based compensation expense:
|
|
|
|
||||||
Performance share awards
|
$
|
2,614
|
|
$
|
3,188
|
|
$
|
2,473
|
|
Restricted and non-restricted stock
|
1,732
|
|
2,161
|
|
1,899
|
|
|||
Deferred retention stock
|
1,461
|
|
1,885
|
|
5,273
|
|
|||
Compensation expense included in operation and maintenance expense
|
5,807
|
|
7,234
|
|
9,645
|
|
|||
Income tax benefit
(1)
|
(2,372
|
)
|
(2,955
|
)
|
(3,940
|
)
|
|||
Total, net of tax
|
$
|
3,435
|
|
$
|
4,279
|
|
$
|
5,705
|
|
(1)
|
Excludes additional tax benefit related to delivered
shares of
$1.3 million
,
$1.8 million
and
$881,000
as of
September 30, 2017
,
2016
and
2015
, respectively.
|
|
Shares
(1)
|
Weighted Average
Grant Date
Fair Value
|
Total Fair Value of Vested Shares (in Thousands)
|
|||||||
Non-vested and outstanding at September 30, 2014
|
247,536
|
|
|
$18.30
|
|
|
—
|
|
|
|
Granted
|
102,790
|
|
|
$28.25
|
|
|
—
|
|
|
|
Vested
(2)
|
(112,446
|
)
|
|
$17.10
|
|
|
$
|
4,318
|
|
|
Cancelled/forfeited
(3)
|
(23,416
|
)
|
|
$17.98
|
|
|
—
|
|
|
|
Non-vested and outstanding at September 30, 2015
|
214,464
|
|
|
$23.40
|
|
|
—
|
|
|
|
Granted
|
115,480
|
|
|
$27.37
|
|
|
—
|
|
|
|
Vested
(4)
|
(137,053
|
)
|
|
$21.40
|
|
|
$
|
5,657
|
|
|
Cancelled/forfeited
(5)
|
(12,975
|
)
|
|
$23.40
|
|
|
—
|
|
|
|
Non-vested and outstanding at September 30, 2016
|
179,916
|
|
|
$27.47
|
|
|
—
|
|
|
|
Granted
|
96,507
|
|
|
$33.57
|
|
|
—
|
|
|
|
Vested
(6)
|
(95,407
|
)
|
|
$28.88
|
|
|
$
|
4,179
|
|
|
Cancelled/forfeited
|
(24,429
|
)
|
|
$29.14
|
|
|
—
|
|
|
|
Non-vested and outstanding at September 30, 2017
|
156,587
|
|
|
$30.12
|
|
|
—
|
|
|
(1)
|
The number of common shares issued related to certain performance shares may range from
zero
to
150 percent
of the number of shares shown in the table above based on the Company’s achievement of performance goals
.
|
(2)
|
As certified by the Company’s Leadership and Compensation Committee on November 10, 2015, the number of common shares related to performance shares earned was
120 percent
, or
112,918
shares, excluding accumulated dividends. The number represented on this line is the target number of
100 percent
. See footnote
(1)
above. Also included in the vested number are
9,364
shares certified by the Leadership and Compensation Committee on November 11, 2014 and
8,984
shares certified by the Leadership and Compensation Committee on November 10, 2015.
|
(3)
|
As certified by the Company’s Leadership and Compensation Committee on November 10, 2015,
9,364
shares were canceled due to not achieving a certain performance target. The remainder were forfeitures due to individuals departing the company.
|
(4)
|
As certified by the Company’s Leadership and Compensation Committee on November 15, 2016, the number of common shares earned related to TSR performance was
85 percent
or
55,702
shares, the number of common shares earned related to NFE performance was
150 percent
or
71,808
shares, and the number of common shares earned related to Performance Based Restricted Stock was
100 percent
or
23,649
shares. Each award earned excludes accumulated dividends. The number represented on this line is the target number of
100 percent
.
|
(5)
|
As certified by the Company’s Leadership and Compensation Committee on November 15, 2016,
9,366
shares were canceled due to not achieving a certain performance target. The remainder were forfeitures due to individuals departing the company.
|
(6)
|
As certified by the Company’s Leadership and Compensation Committee on November 14, 2017, the number of common shares earned related to TSR performance was
108.44 percent
or
39,595
shares, the number of common shares earned related to NFE performance was
119 percent
or
36,498
shares and the number of common shares earned related to Performance Based Restricted Stock was
100 percent
or
28,223
shares. Each award earned excludes accumulated dividends. The number represented on this line is the target number of
100 percent
.
|
|
Shares
|
|
Weighted Average
Grant Date
Fair Value
|
Total Fair Value of Vested Shares (in Thousands)
|
||||||
Non-vested and outstanding at September 30, 2014
|
41,491
|
|
|
$22.60
|
|
|
—
|
|
|
|
Granted
|
61,972
|
|
|
$29.41
|
|
|
—
|
|
|
|
Vested
|
(18,170
|
)
|
|
$24.45
|
|
|
$
|
510
|
|
|
Cancelled/forfeited
|
(3,801
|
)
|
|
$26.79
|
|
|
—
|
|
|
|
Non-vested and outstanding at September 30, 2015
|
81,492
|
|
|
$27.17
|
|
|
—
|
|
|
|
Granted
|
41,909
|
|
|
$30.03
|
|
|
—
|
|
|
|
Vested
|
(48,089
|
)
|
|
$26.66
|
|
|
$
|
1,469
|
|
|
Cancelled/forfeited
|
(2,241
|
)
|
|
$29.21
|
|
|
—
|
|
|
|
Non-vested and outstanding at September 30, 2016
|
73,071
|
|
|
$29.09
|
|
|
—
|
|
|
|
Granted
|
28,734
|
|
|
$35.79
|
|
|
|
|
||
Vested
|
(38,752
|
)
|
|
$28.92
|
|
|
$
|
1,344
|
|
|
Cancelled/forfeited
|
(11,899
|
)
|
|
$31.56
|
|
|
|
|
||
Non-vested and outstanding at September 30, 2017
|
51,154
|
|
|
$32.40
|
|
|
—
|
|
|
|
Shares
|
Weighted Average
Grant Date
Fair Value
|
Total Fair Value of Vested Shares (in Thousands)
|
|||||||
Outstanding at September 30, 2014
|
276,782
|
|
|
$21.95
|
|
|
—
|
|
|
|
Granted/Vested
|
462,790
|
|
|
$29.32
|
|
|
—
|
|
|
|
Delivered
|
(95,098
|
)
|
|
$23.62
|
|
|
$
|
2,519
|
|
|
Forfeited
|
(11,744
|
)
|
|
$24.69
|
|
|
—
|
|
|
|
Outstanding at September 30, 2015
|
632,730
|
|
|
$27.03
|
|
|
—
|
|
|
|
Granted/Vested
|
159,831
|
|
|
$30.37
|
|
|
—
|
|
|
|
Delivered
|
(121,764
|
)
|
|
$20.31
|
|
|
$
|
3,751
|
|
|
Forfeited
|
(8,318
|
)
|
|
$28.14
|
|
|
—
|
|
|
|
Outstanding at September 30, 2016
|
662,479
|
|
|
$29.06
|
|
|
—
|
|
|
|
Granted/Vested
|
63,977
|
|
|
$35.64
|
|
|
—
|
|
|
|
Delivered
|
(53,878
|
)
|
|
$23.11
|
|
|
$
|
1,774
|
|
|
Outstanding at September 30, 2017
|
672,578
|
|
|
$29.54
|
|
|
—
|
|
|
|
Shares
|
Weighted Average
Exercise Price
|
|||
Outstanding at September 30, 2014
|
48,250
|
|
|
$15.00
|
|
Exercised
|
(48,250
|
)
|
|
$15.00
|
|
Outstanding at September 30, 2015
|
—
|
|
|
$0.00
|
|
|
2017
|
2016
|
2015
|
|
Shares granted
|
27,972
|
(1)
|
27,481
|
26,122
|
Weighted average grant date fair value
|
$35.59
|
|
$32.75
|
$30.63
|
(1)
|
$280,000
of expense remains as of
September 30, 2017
, to be recognized through
December 31, 2017
.
|
|
Pension
(1)
|
OPEB
|
||||||||||
(Thousands)
|
2017
|
2016
|
2017
|
2016
|
||||||||
Change in Benefit Obligation
|
|
|
|
|
||||||||
Benefit obligation at beginning of year
|
$
|
293,654
|
|
$
|
255,987
|
|
$
|
160,393
|
|
$
|
138,367
|
|
Service cost
|
8,347
|
|
7,591
|
|
4,380
|
|
4,521
|
|
||||
Interest cost
|
9,771
|
|
11,342
|
|
5,545
|
|
6,256
|
|
||||
Plan participants’ contributions
(2)
|
45
|
|
47
|
|
120
|
|
104
|
|
||||
Actuarial (gain) loss
|
(5,995
|
)
|
26,369
|
|
8,985
|
|
15,590
|
|
||||
Benefits paid, net of retiree subsidies received
|
(7,987
|
)
|
(7,682
|
)
|
(4,333
|
)
|
(4,445
|
)
|
||||
Benefit obligation at end of year
|
$
|
297,835
|
|
$
|
293,654
|
|
$
|
175,090
|
|
$
|
160,393
|
|
Change in plan assets
|
|
|
|
|
||||||||
Fair value of plan assets at beginning of year
|
$
|
249,875
|
|
$
|
199,123
|
|
$
|
62,035
|
|
$
|
57,269
|
|
Actual return on plan assets
|
29,736
|
|
28,316
|
|
7,953
|
|
5,872
|
|
||||
Employer contributions
|
74
|
|
30,071
|
|
6,049
|
|
3,235
|
|
||||
Benefits paid, net of plan participants’ contributions
(2)
|
(7,942
|
)
|
(7,635
|
)
|
(4,503
|
)
|
(4,341
|
)
|
||||
Fair value of plan assets at end of year
|
$
|
271,743
|
|
$
|
249,875
|
|
$
|
71,534
|
|
$
|
62,035
|
|
Funded status
|
$
|
(26,092
|
)
|
$
|
(43,779
|
)
|
$
|
(103,556
|
)
|
$
|
(98,358
|
)
|
Amounts recognized on Consolidated Balance Sheets
|
|
|
|
|
||||||||
Postemployment employee (liability)
|
|
|
|
|
||||||||
Current
|
$
|
(158
|
)
|
$
|
(79
|
)
|
$
|
(602
|
)
|
$
|
(454
|
)
|
Noncurrent
|
(25,934
|
)
|
(43,700
|
)
|
(102,954
|
)
|
(97,904
|
)
|
||||
Total
|
$
|
(26,092
|
)
|
$
|
(43,779
|
)
|
$
|
(103,556
|
)
|
$
|
(98,358
|
)
|
(1)
|
Includes the Company’s PEP.
|
(2)
|
Prior to July 1, 1998, employees were eligible to elect an additional participant contribution to enhance their benefits and contributions made during the periods were insignificant.
|
|
Regulatory Assets
|
|
Accumulated Other Comprehensive Income (Loss)
|
||||||||||
|
Pension
|
OPEB
|
|
Pension
|
OPEB
|
||||||||
Balance at September 30, 2015
|
$
|
86,960
|
|
$
|
50,737
|
|
|
$
|
25,640
|
|
$
|
1,242
|
|
Amounts arising during the period:
|
|
|
|
|
|
||||||||
Net actuarial loss
|
13,696
|
|
11,274
|
|
|
4,475
|
|
3,289
|
|
||||
Amounts amortized to net periodic costs:
|
|
|
|
|
|
||||||||
Net actuarial (loss)
|
(5,607
|
)
|
(3,175
|
)
|
|
(1,676
|
)
|
(99
|
)
|
||||
Prior service (cost) credit
|
(108
|
)
|
311
|
|
|
(3
|
)
|
54
|
|
||||
Balance at September 30, 2016
|
$
|
94,941
|
|
$
|
59,147
|
|
|
$
|
28,436
|
|
$
|
4,486
|
|
Amounts arising during the period:
|
|
|
|
|
|
||||||||
Net actuarial (gain) loss
|
(9,429
|
)
|
5,211
|
|
|
(6,990
|
)
|
587
|
|
||||
Amounts amortized to net periodic costs:
|
|
|
|
|
|
||||||||
Net actuarial (loss)
|
(6,799
|
)
|
(4,209
|
)
|
|
(2,028
|
)
|
(160
|
)
|
||||
Prior service (cost) credit
|
(108
|
)
|
311
|
|
|
(3
|
)
|
54
|
|
||||
Balance at September 30, 2017
|
$
|
78,605
|
|
$
|
60,460
|
|
|
$
|
19,415
|
|
$
|
4,967
|
|
|
Regulatory Assets
|
Accumulated Other Comprehensive Income (Loss)
|
||||||||||||||||||||||
|
Pension
|
OPEB
|
Pension
|
OPEB
|
||||||||||||||||||||
(Thousands)
|
2017
|
2016
|
2017
|
2016
|
2017
|
2016
|
2017
|
2016
|
||||||||||||||||
Net actuarial loss
|
$
|
77,930
|
|
$
|
94,158
|
|
$
|
61,563
|
|
$
|
60,561
|
|
$
|
19,414
|
|
$
|
28,432
|
|
$
|
5,113
|
|
$
|
4,686
|
|
Prior service cost (credit)
|
675
|
|
783
|
|
(1,103
|
)
|
(1,414
|
)
|
1
|
|
4
|
|
(146
|
)
|
(200
|
)
|
||||||||
Total
|
$
|
78,605
|
|
$
|
94,941
|
|
$
|
60,460
|
|
$
|
59,147
|
|
$
|
19,415
|
|
$
|
28,436
|
|
$
|
4,967
|
|
$
|
4,486
|
|
|
Regulatory Assets
|
|
Accumulated Other Comprehensive Income (Loss)
|
||||||||||
(Thousands)
|
Pension
|
OPEB
|
|
Pension
|
OPEB
|
||||||||
Net actuarial loss
|
$
|
6,177
|
|
$
|
4,464
|
|
|
$
|
1,360
|
|
$
|
196
|
|
Prior service cost (credit)
|
105
|
|
(311
|
)
|
|
1
|
|
(53
|
)
|
||||
Total
|
$
|
6,282
|
|
$
|
4,153
|
|
|
$
|
1,361
|
|
$
|
143
|
|
|
Pension
|
|||||
(Thousands)
|
2017
|
2016
|
||||
Projected benefit obligation
|
$
|
297,835
|
|
$
|
293,654
|
|
Accumulated benefit obligation
|
$
|
258,514
|
|
$
|
252,077
|
|
Fair value of plan assets
|
$
|
271,743
|
|
$
|
249,875
|
|
|
Pension
|
OPEB
|
||||||||||||||||
(Thousands)
|
2017
|
2016
|
2015
|
2017
|
2016
|
2015
|
||||||||||||
Service cost
|
$
|
8,347
|
|
$
|
7,591
|
|
$
|
7,485
|
|
$
|
4,380
|
|
$
|
4,521
|
|
$
|
4,253
|
|
Interest cost
|
9,771
|
|
11,342
|
|
10,199
|
|
5,545
|
|
6,256
|
|
5,739
|
|
||||||
Expected return on plan assets
|
(19,313
|
)
|
(20,118
|
)
|
(17,090
|
)
|
(4,767
|
)
|
(4,845
|
)
|
(4,977
|
)
|
||||||
Recognized actuarial loss
|
8,827
|
|
7,281
|
|
6,985
|
|
4,370
|
|
3,274
|
|
2,943
|
|
||||||
Prior service cost (credit) amortization
|
111
|
|
111
|
|
111
|
|
(365
|
)
|
(365
|
)
|
(364
|
)
|
||||||
Net periodic benefit cost recognized as expense
|
$
|
7,743
|
|
$
|
6,207
|
|
$
|
7,690
|
|
$
|
9,163
|
|
$
|
8,841
|
|
$
|
7,594
|
|
|
Pension
|
|
OPEB
|
|
||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
|
2015
|
|
||||||
Benefit costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Discount rate
|
3.96/3.94%
|
|
4.50
|
%
|
|
4.55
|
%
|
|
4.08/4.01%
|
|
(1)
|
4.60/4.55%
|
|
(1)
|
4.55
|
%
|
|
|
Expected asset return
|
7.75
|
%
|
|
8.75
|
%
|
|
8.75
|
%
|
|
7.75
|
%
|
|
8.75
|
%
|
|
8.75
|
%
|
|
Compensation increase
|
3.25/3.50%
|
|
(1)
|
3.25/3.50%
|
|
(1)
|
3.25
|
%
|
|
3.25/3.50%
|
|
(1)
|
3.50
|
%
|
|
3.50
|
%
|
|
Obligations:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Discount rate
|
4.03
|
%
|
|
3.96/3.94%
|
|
(1)
|
4.50
|
%
|
|
4.12/4.08%
|
|
(1)
|
4.08/4.01%
|
|
(1)
|
4.60/4.55%
|
|
(1)
|
Compensation increase
|
3.25/3.50%
|
|
(1)
|
3.25/3.50%
|
|
(1)
|
3.25/3.50%
|
|
(1)
|
3.25/3.50%
|
|
(1)
|
3.50
|
%
|
|
3.50
|
%
|
|
(1)
|
Percentages for represented and nonrepresented plans, respectively.
|
($ in thousands)
|
2017
|
|
2016
|
|
2015
|
||||||
HCCTR
|
8.3
|
%
|
|
8.5
|
%
|
|
6.7
|
%
|
|||
Ultimate HCCTR
|
4.5
|
%
|
|
4.5
|
%
|
|
4.8
|
%
|
|||
Year ultimate HCCTR reached
|
2025
|
|
|
2025
|
|
|
2022
|
|
|||
Effect of a 1 percentage point increase in the HCCTR on:
|
|
|
|
|
|
||||||
Year-end benefit obligation
|
$
|
32,019
|
|
|
$
|
28,803
|
|
|
$
|
26,025
|
|
Total service and interest cost
|
$
|
2,468
|
|
|
$
|
2,331
|
|
|
$
|
2,026
|
|
Effect of a 1 percentage point decrease in the HCCTR on:
|
|
|
|
|
|
||||||
Year-end benefit obligation
|
$
|
(25,466
|
)
|
|
$
|
(22,862
|
)
|
|
$
|
(20,427
|
)
|
Total service and interest costs
|
$
|
(1,909
|
)
|
|
$
|
(1,801
|
)
|
|
$
|
(1,593
|
)
|
|
2018
|
Assets at
|
|||||||
|
Target
|
September 30,
|
|||||||
Asset Allocation
|
Allocation
|
2017
|
|
|
2016
|
|
|
||
U.S. equity securities
|
40
|
%
|
|
39
|
%
|
|
38
|
%
|
|
International equity securities
|
20
|
|
|
21
|
|
|
20
|
|
|
Fixed income
|
40
|
|
|
40
|
|
|
42
|
|
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
(Thousands)
|
Pension
|
OPEB
|
||||
2018
|
$
|
8,928
|
|
$
|
4,230
|
|
2019
|
$
|
9,712
|
|
$
|
4,807
|
|
2020
|
$
|
10,549
|
|
$
|
5,435
|
|
2021
|
$
|
11,502
|
|
$
|
6,061
|
|
2022
|
$
|
12,469
|
|
$
|
6,755
|
|
2023 - 2027
|
$
|
79,081
|
|
$
|
43,267
|
|
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
||||||||||||||
(Thousands)
|
Pension
|
|
OPEB
|
||||||||||||
Assets
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Money market funds
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
9
|
|
Registered Investment Companies:
|
|
|
|
|
|
|
|
||||||||
Equity Funds:
|
|
|
|
|
|
|
|
||||||||
Large Cap Index
|
88,321
|
|
|
78,306
|
|
|
23,986
|
|
|
19,532
|
|
||||
Extended Market Index
|
16,329
|
|
|
16,250
|
|
|
4,409
|
|
|
4,114
|
|
||||
International Stock
|
56,446
|
|
|
50,702
|
|
|
15,000
|
|
|
12,997
|
|
||||
Fixed Income Funds:
|
|
|
|
|
|
|
|
||||||||
Emerging Markets
|
13,516
|
|
|
12,906
|
|
|
3,551
|
|
|
3,294
|
|
||||
Core Fixed Income
|
—
|
|
|
—
|
|
|
8,082
|
|
|
7,177
|
|
||||
Opportunistic Income
|
—
|
|
|
—
|
|
|
4,744
|
|
|
4,155
|
|
||||
Ultra Short Duration
|
—
|
|
|
—
|
|
|
4,673
|
|
|
4,082
|
|
||||
High Yield Bond Fund
|
26,540
|
|
|
25,976
|
|
|
7,078
|
|
|
6,675
|
|
||||
Long Duration Fund
|
70,591
|
|
|
65,735
|
|
|
—
|
|
|
—
|
|
||||
Total assets at fair value
|
$
|
271,743
|
|
|
$
|
249,875
|
|
|
$
|
71,534
|
|
|
$
|
62,035
|
|
(Thousands)
|
2017
|
|
2016
|
||||||||||
|
NJNG
|
NJRCEV
|
|
NJNG
|
NJRCEV
|
||||||||
Balance at October 1
|
$
|
23,521
|
|
$
|
4,858
|
|
|
$
|
16,773
|
|
$
|
2,372
|
|
Accretion
|
1,304
|
|
245
|
|
|
1,048
|
|
158
|
|
||||
Additions
|
729
|
|
1,492
|
|
|
783
|
|
2,328
|
|
||||
Revisions in estimated cash flows
|
(245
|
)
|
—
|
|
|
5,320
|
|
—
|
|
||||
Retirements
|
(484
|
)
|
—
|
|
|
(403
|
)
|
—
|
|
||||
Balance at period end
|
$
|
24,825
|
|
$
|
6,595
|
|
|
$
|
23,521
|
|
$
|
4,858
|
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Statutory income tax expense
|
$
|
52,643
|
|
$
|
54,321
|
|
$
|
84,239
|
|
Change resulting from:
|
|
|
|
||||||
State income taxes
|
8,222
|
|
6,044
|
|
8,233
|
|
|||
Cost of removal of assets placed in service prior to1981
|
(6,886
|
)
|
(5,738
|
)
|
(5,149
|
)
|
|||
Investment/production tax credits
|
(34,526
|
)
|
(32,491
|
)
|
(30,096
|
)
|
|||
Basis adjustment of solar assets due to ITC
|
4,256
|
|
4,453
|
|
4,861
|
|
|||
AFUDC equity
|
(2,624
|
)
|
(1,531
|
)
|
(1,339
|
)
|
|||
Other
|
(2,742
|
)
|
(1,528
|
)
|
(1,025
|
)
|
|||
Income tax provision
|
$
|
18,343
|
|
$
|
23,530
|
|
$
|
59,724
|
|
Effective income tax rate
|
12.2
|
%
|
15.2
|
%
|
24.8
|
%
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Current:
|
|
|
|
||||||
Federal
|
$
|
(16,023
|
)
|
$
|
(23,597
|
)
|
$
|
20,492
|
|
State
|
2,470
|
|
(2,209
|
)
|
5,473
|
|
|||
Deferred:
|
|
|
|
||||||
Federal
|
54,965
|
|
70,386
|
|
56,480
|
|
|||
State
|
11,457
|
|
11,441
|
|
7,375
|
|
|||
Investment/production tax credits
|
(34,526
|
)
|
(32,491
|
)
|
(30,096
|
)
|
|||
Income tax provision
|
$
|
18,343
|
|
$
|
23,530
|
|
$
|
59,724
|
|
(Thousands)
|
2017
|
|
2016
|
||||
Deferred tax assets
|
|
|
|
||||
Investment tax credits
(1)
|
$
|
111,642
|
|
|
$
|
76,517
|
|
Deferred service contract revenue
|
3,877
|
|
|
3,601
|
|
||
Incentive compensation
|
6,260
|
|
|
8,128
|
|
||
Fair value of derivatives
|
11,519
|
|
|
1,179
|
|
||
Federal net operating losses
|
28,487
|
|
|
27,541
|
|
||
State net operating losses
|
23,597
|
|
|
18,113
|
|
||
Overrecovered gas costs
|
—
|
|
|
3,831
|
|
||
Other
|
13,845
|
|
|
11,668
|
|
||
Total deferred tax assets
|
$
|
199,227
|
|
|
$
|
150,578
|
|
Deferred tax liabilities
|
|
|
|
||||
Property related items
|
$
|
(620,850
|
)
|
|
$
|
(532,027
|
)
|
Remediation costs
|
(11,625
|
)
|
|
(7,928
|
)
|
||
Equity investments
|
(38,370
|
)
|
|
(37,740
|
)
|
||
Postemployment benefits
|
(6,855
|
)
|
|
(7,902
|
)
|
||
Conservation incentive plan
|
(7,195
|
)
|
|
(14,953
|
)
|
||
Underrecovered gas costs
|
(4,035
|
)
|
|
—
|
|
||
Other
|
(16,643
|
)
|
|
(14,610
|
)
|
||
Total deferred tax liabilities
|
$
|
(705,573
|
)
|
|
$
|
(615,160
|
)
|
Total net deferred tax liabilities
|
$
|
(506,346
|
)
|
|
$
|
(464,582
|
)
|
(1)
|
Includes
$2.3 million
and
$2.5 million
for NJNG for
fiscal 2017
and
2016
, respectively
, which is being amortized over the life of the related assets, and
$109.3 million
and
$74 million
for Clean Energy Ventures for
fiscal 2017
and
2016
, respectively
, which is ITC carryforward.
|
(Thousands)
|
2018
|
2019
|
2020
|
2021
|
2022
|
Thereafter
|
||||||||||||
Energy Services:
|
|
|
|
|
|
|
||||||||||||
Natural gas purchases
|
$
|
296,491
|
|
$
|
114,817
|
|
$
|
22,270
|
|
$
|
11,488
|
|
$
|
—
|
|
$
|
—
|
|
Storage demand fees
|
32,870
|
|
22,638
|
|
13,350
|
|
9,041
|
|
5,833
|
|
2,746
|
|
||||||
Pipeline demand fees
|
55,916
|
|
32,412
|
|
23,804
|
|
21,621
|
|
19,653
|
|
19,311
|
|
||||||
Sub-total Energy Services
|
$
|
385,277
|
|
$
|
169,867
|
|
$
|
59,424
|
|
$
|
42,150
|
|
$
|
25,486
|
|
$
|
22,057
|
|
NJNG:
|
|
|
|
|
|
|
||||||||||||
Natural gas purchases
|
$
|
51,050
|
|
$
|
41,156
|
|
$
|
2,514
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
Storage demand fees
|
30,042
|
|
26,628
|
|
15,331
|
|
8,231
|
|
7,804
|
|
3,903
|
|
||||||
Pipeline demand fees
|
68,544
|
|
102,091
|
|
100,909
|
|
91,231
|
|
89,859
|
|
642,481
|
|
||||||
Sub-total NJNG
|
$
|
149,636
|
|
$
|
169,875
|
|
$
|
118,754
|
|
$
|
99,462
|
|
$
|
97,663
|
|
$
|
646,384
|
|
Total
|
$
|
534,913
|
|
$
|
339,742
|
|
$
|
178,178
|
|
$
|
141,612
|
|
$
|
123,149
|
|
$
|
668,441
|
|
(Thousands)
|
|
|
|
||||||
Fiscal Years Ended September 30,
|
2017
|
2016
|
2015
|
||||||
Operating revenues
|
|
|
|
||||||
Natural Gas Distribution
|
|
|
|
||||||
External customers
|
$
|
695,637
|
|
$
|
594,346
|
|
$
|
781,970
|
|
Clean Energy Ventures
|
|
|
|
||||||
External customers
|
64,394
|
|
53,540
|
|
32,513
|
|
|||
Energy Services
|
|
|
|
||||||
External customers
(1)
|
1,462,365
|
|
1,187,754
|
|
1,872,781
|
|
|||
Intercompany
|
316
|
|
9,499
|
|
61,526
|
|
|||
Subtotal
|
2,222,712
|
|
1,845,139
|
|
2,748,790
|
|
|||
Home Services and Other
|
|
|
|
||||||
External customers
|
46,221
|
|
45,265
|
|
46,723
|
|
|||
Intercompany
|
3,370
|
|
3,232
|
|
1,980
|
|
|||
Eliminations
|
(3,686
|
)
|
(12,731
|
)
|
(63,506
|
)
|
|||
Total
|
$
|
2,268,617
|
|
$
|
1,880,905
|
|
$
|
2,733,987
|
|
Depreciation and amortization
|
|
|
|
||||||
Natural Gas Distribution
|
$
|
49,347
|
|
$
|
47,828
|
|
$
|
43,085
|
|
Clean Energy Ventures
|
31,834
|
|
23,971
|
|
17,297
|
|
|||
Energy Services
|
63
|
|
88
|
|
90
|
|
|||
Midstream
|
6
|
|
6
|
|
6
|
|
|||
Subtotal
|
81,250
|
|
71,893
|
|
60,478
|
|
|||
Home Services and Other
|
798
|
|
981
|
|
952
|
|
|||
Eliminations
|
(207
|
)
|
(126
|
)
|
(31
|
)
|
|||
Total
|
$
|
81,841
|
|
$
|
72,748
|
|
$
|
61,399
|
|
Interest income
(2)
|
|
|
|
||||||
Natural Gas Distribution
|
$
|
555
|
|
$
|
115
|
|
$
|
336
|
|
Clean Energy Ventures
|
—
|
|
—
|
|
26
|
|
|||
Energy Services
|
6
|
|
98
|
|
438
|
|
|||
Midstream
|
2,195
|
|
1,524
|
|
977
|
|
|||
Subtotal
|
2,756
|
|
1,737
|
|
1,777
|
|
|||
Home Services and Other
|
590
|
|
397
|
|
217
|
|
|||
Eliminations
|
(1,312
|
)
|
(2,006
|
)
|
(1,414
|
)
|
|||
Total
|
$
|
2,034
|
|
$
|
128
|
|
$
|
580
|
|
(1)
|
Includes sales to Canada, which accounted for
.8
,
2
and
3.7 percent
of total operating revenues during
fiscal 2017
,
2016
and
2015
, respectively
.
|
(2)
|
Included in other income, net on the Consolidated Statements of Operations.
|
(Thousands)
|
|
|
|
||||||
Fiscal Years Ended September 30,
|
2017
|
2016
|
2015
|
||||||
Interest expense, net of capitalized interest
|
|
|
|
||||||
Natural Gas Distribution
|
$
|
25,818
|
|
$
|
19,930
|
|
$
|
18,534
|
|
Clean Energy Ventures
|
16,263
|
|
10,304
|
|
7,635
|
|
|||
Energy Services
|
2,747
|
|
1,095
|
|
1,209
|
|
|||
Midstream
|
960
|
|
287
|
|
717
|
|
|||
Subtotal
|
45,788
|
|
31,616
|
|
28,095
|
|
|||
Home Services and Other
|
410
|
|
252
|
|
49
|
|
|||
Eliminations
|
(1,312
|
)
|
(824
|
)
|
(423
|
)
|
|||
Total
|
$
|
44,886
|
|
$
|
31,044
|
|
$
|
27,721
|
|
Income tax (benefit) provision
|
|
|
|
||||||
Natural Gas Distribution
|
$
|
43,485
|
|
$
|
34,951
|
|
$
|
39,544
|
|
Clean Energy Ventures
|
(31,161
|
)
|
(26,592
|
)
|
(26,968
|
)
|
|||
Energy Services
|
(4,015
|
)
|
7,030
|
|
39,043
|
|
|||
Midstream
|
5,820
|
|
6,130
|
|
6,849
|
|
|||
Subtotal
|
14,129
|
|
21,519
|
|
58,468
|
|
|||
Home Services and Other
|
3,857
|
|
1,387
|
|
1,551
|
|
|||
Eliminations
|
357
|
|
624
|
|
(295
|
)
|
|||
Total
|
$
|
18,343
|
|
$
|
23,530
|
|
$
|
59,724
|
|
Equity in earnings of affiliates
|
|
|
|
||||||
Midstream
|
$
|
17,797
|
|
$
|
13,936
|
|
$
|
17,487
|
|
Eliminations
|
(3,984
|
)
|
(4,421
|
)
|
(4,078
|
)
|
|||
Total
|
$
|
13,813
|
|
$
|
9,515
|
|
$
|
13,409
|
|
Net financial earnings
|
|
|
|
||||||
Natural Gas Distribution
|
$
|
86,930
|
|
$
|
76,104
|
|
$
|
76,287
|
|
Clean Energy Ventures
|
24,873
|
|
28,393
|
|
20,101
|
|
|||
Energy Services
|
18,554
|
|
21,934
|
|
42,122
|
|
|||
Midstream
|
12,857
|
|
9,406
|
|
9,780
|
|
|||
Subtotal
|
143,214
|
|
135,837
|
|
148,290
|
|
|||
Home Services and Other
|
6,811
|
|
2,882
|
|
3,420
|
|
|||
Eliminations
|
(633
|
)
|
(634
|
)
|
(207
|
)
|
|||
Total
|
$
|
149,392
|
|
$
|
138,085
|
|
$
|
151,503
|
|
Capital expenditures
|
|
|
|
||||||
Natural Gas Distribution
|
$
|
176,249
|
|
$
|
205,133
|
|
$
|
168,875
|
|
Clean Energy Ventures
|
149,400
|
|
149,063
|
|
151,002
|
|
|||
Subtotal
|
325,649
|
|
354,196
|
|
319,877
|
|
|||
Home Services and Other
|
2,434
|
|
1,896
|
|
209
|
|
|||
Total
|
$
|
328,083
|
|
$
|
356,092
|
|
$
|
320,086
|
|
Investments in equity investees
|
|
|
|
||||||
Midstream
|
27,070
|
|
11,176
|
|
5,780
|
|
|||
Total
|
$
|
27,070
|
|
$
|
11,176
|
|
$
|
5,780
|
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Consolidated net financial earnings
|
$
|
149,392
|
|
$
|
138,085
|
|
$
|
151,503
|
|
Less:
|
|
|
|
||||||
Unrealized (gain) loss on derivative instruments and related transactions
|
(11,241
|
)
|
46,883
|
|
(38,681
|
)
|
|||
Tax effect
|
4,062
|
|
(17,018
|
)
|
14,391
|
|
|||
Effects of economic hedging related to natural gas inventory
|
38,470
|
|
(36,816
|
)
|
(8,225
|
)
|
|||
Tax effect
|
(13,964
|
)
|
13,364
|
|
3,058
|
|
|||
Consolidated net income
|
$
|
132,065
|
|
$
|
131,672
|
|
$
|
180,960
|
|
•
|
Unrealized gains and losses on derivatives are recognized in reported earnings in periods prior to physical gas inventory flows; and
|
•
|
Unrealized gains and losses of prior periods are reclassified as realized gains and losses when derivatives are settled in the same period as physical gas inventory movements occur.
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
Assets at end of period:
|
|
|
|
||||||
Natural Gas Distribution
|
$
|
2,519,578
|
|
$
|
2,517,401
|
|
$
|
2,305,293
|
|
Clean Energy Ventures
|
771,340
|
|
665,696
|
|
504,885
|
|
|||
Energy Services
|
398,277
|
|
327,626
|
|
260,021
|
|
|||
Midstream
|
232,806
|
|
186,259
|
|
182,007
|
|
|||
Subtotal
|
3,922,001
|
|
3,696,982
|
|
3,252,206
|
|
|||
Home Services and Other
|
114,801
|
|
109,487
|
|
88,880
|
|
|||
Intercompany assets
(1)
|
(108,295
|
)
|
(87,899
|
)
|
(56,729
|
)
|
|||
Total
|
$
|
3,928,507
|
|
$
|
3,718,570
|
|
$
|
3,284,357
|
|
(1)
|
Consists of transactions between subsidiaries that are eliminated and reclassified in consolidation.
|
(Thousands)
|
2017
|
2016
|
2015
|
||||||
NJNG
|
$
|
5,590
|
|
$
|
5,562
|
|
$
|
5,700
|
|
Energy Services
|
2,750
|
|
2,789
|
|
1,957
|
|
|||
Total
|
$
|
8,340
|
|
$
|
8,351
|
|
$
|
7,657
|
|
(Thousands)
|
2017
|
2016
|
||||
NJNG
|
$
|
775
|
|
$
|
775
|
|
Energy Services
|
377
|
|
375
|
|
||
Total
|
$
|
1,152
|
|
$
|
1,150
|
|
|
First
|
Second
|
Third
|
Fourth
|
||||||||
(Thousands, except per share data)
|
Quarter
|
Quarter
|
Quarter
|
Quarter
|
||||||||
2017
|
|
|
|
|
||||||||
Operating revenues
|
$
|
541,028
|
|
$
|
733,546
|
|
$
|
457,523
|
|
$
|
536,520
|
|
Operating income (loss)
|
$
|
41,475
|
|
$
|
139,653
|
|
$
|
17,967
|
|
$
|
(32,051
|
)
|
Net income (loss)
|
$
|
34,929
|
|
$
|
114,702
|
|
$
|
18,957
|
|
$
|
(36,523
|
)
|
Earnings (loss) per share
(1)
|
|
|
|
|
||||||||
Basic
|
$0.41
|
$1.33
|
$0.22
|
$(0.42)
|
||||||||
Diluted
|
$0.40
|
$1.32
|
$0.22
|
$(0.42)
|
||||||||
2016
|
|
|
|
|
||||||||
Operating revenues
|
$
|
444,258
|
|
$
|
574,193
|
|
$
|
393,213
|
|
$
|
469,241
|
|
Operating income (loss)
|
$
|
59,451
|
|
$
|
93,933
|
|
$
|
(28,329
|
)
|
$
|
42,480
|
|
Net income (loss)
|
$
|
50,281
|
|
$
|
73,354
|
|
$
|
(17,363
|
)
|
$
|
25,400
|
|
Earnings (loss) per share
(1)
|
|
|
|
|
||||||||
Basic
|
$0.59
|
$0.85
|
$(0.20)
|
$0.30
|
||||||||
Diluted
|
$0.58
|
$0.84
|
$(0.20)
|
$0.29
|
(1)
|
The sum of quarterly amounts may not equal the annual amounts due to rounding.
|
(a) 1. Financial Statements.
|
||
|
|
|
All Financial Statements of the Registrant are filed as part of this report and included in
Item 8
of
Part II
of this Form 10-K.
|
||
|
|
|
(a) 2. Financial Statement Schedules-See
Index to Financial Statement Schedules
in
Item 8
.
|
||
|
|
|
(a) 3. Exhibits-See
Exhibit Index
on page
|
130
.
|
|
|
|
Page
|
|
Schedule II - Valuation and qualifying accounts and reserves for each of the three years in the period ended September 30, 2017
|
(Thousands)
|
|
ADDITIONS
|
|
|
||||||
CLASSIFICATION
|
BEGINNING
BALANCE
|
CHARGED TO
EXPENSE
|
OTHER
(1)
|
ENDING BALANCE
|
||||||
2017
|
|
|
|
|
||||||
Allowance for doubtful accounts
|
$
|
4,865
|
|
2,023
|
|
(1,707
|
)
|
$
|
5,181
|
|
2016
|
|
|
|
|
||||||
Allowance for doubtful accounts
|
$
|
5,189
|
|
1,616
|
|
(1,940
|
)
|
$
|
4,865
|
|
2015
|
|
|
|
|
||||||
Allowance for doubtful accounts
|
$
|
5,357
|
|
2,859
|
|
(3,027
|
)
|
$
|
5,189
|
|
(1)
|
Uncollectible accounts written off, less recoveries and adjustments.
|
Exhibit
Number
|
Exhibit Description
|
|
|
2.1*
|
Purchase and Sale Agreement, dated as of October 27, 2017, by and between Talen Generation, LLC, and Adelphia Gateway, LLC (incorporated by reference to
Exhibit 2.1 to the Current Report on Form 8-K, as filed on November 2, 2017
)
|
|
|
3.1
|
Restated Certificate of Incorporation of New Jersey Resources Corporation, as amended through March 3, 2015 (incorporated by reference to
Exhibit 3.1 to the Current Report on Form 8-K, as filed on January 23, 2014
, and
Exhibit 3.1 to the Current Report on Form 8-K, as filed on March 3, 2015
)
|
|
|
3.2
|
Bylaws of New Jersey Resources Corporation, as amended through September 12, 2016 (incorporated by reference to
Exhibit 3.1 to the Current Report on Form 8-K, as filed on September 12, 2016
)
|
|
|
4.1
|
Specimen Common Stock Certificate (incorporated by reference to
Exhibit 4.1 to the Annual Report on Form 10-K for the year ended September 30, 2013, as filed on November 25, 2013
)
|
|
|
4.2
|
Amended and Restated Indenture of Mortgage, Deed of Trust and Security Agreement, dated as of September 1, 2014, between NJNG and U.S. Bank National Association, as Trustee (incorporated by reference to
Exhibit 99.3 to the Current Report on Form 8-K, as filed on September 30, 2014
)
|
|
|
4.2(a)
|
36th Supplemental Indenture dated as of September 1, 2014, between NJNG and U.S. Bank National Association, as Trustee (incorporated by reference to
Exhibit 99.2 to the Current Report on Form 8-K, as filed on September 30, 2014
)
|
|
|
4.2(b)
|
Second Supplemental Indenture dated as of June 1, 2016, between New Jersey Natural Gas Company and U.S. Bank National Association, as Trustee (incorporated by reference to
Exhibit 4.2 to Form 8-K as filed on June 22, 2016
)
|
|
|
4.3
|
$250,000,000 Credit Agreement dated as of May 15, 2014, by and among New Jersey Natural Gas Company, the Lenders party thereto, PNC Bank, National Association, as Administrative Agent, Wells Fargo Bank, National Association, as Syndication Agent, U.S. Bank National Association, TD Bank, N.A., and Santander Bank, N.A., as Documentation Agents, and PNC Capital Markets LLC and Wells Fargo Securities, LLC, as Joint Lead Arrangers (incorporated by reference to
Exhibit 4.3 to the Quarterly Report on Form 10-Q for the quarter ended June 30, 2014, as filed on August 4, 2014
)
|
|
|
4.4
|
$425,000,000 Amended and Restated Credit Agreement dated as of September 28, 2015, by and among the Company, the guarantors thereto, the lenders party thereto, PNC Bank, National Association, as Administrative Agent, JPMorgan Chase Bank, N.A. and Wells Fargo Bank, National Association, as Syndication Agents, Bank of America, N.A., TD Bank, N.A. and U.S. Bank National Association, as Documentation Agents, and PNC Capital Markets LLC, J.P. Morgan Securities LLC and Wells Fargo Securities, LLC, as Joint Lead Arrangers (incorporated by reference to
Exhibit 10.1 to the Current Report on Form 8-K as filed on October 2, 2015
)
|
|
|
4.5
|
$75,000,000 Shelf Note Purchase Agreement, dated as of June 30, 2011, between New Jersey Resources Corporation and Prudential Investment Management, Inc. (“Prudential Facility”) (incorporated by reference to
Exhibit 4.1 to the Current Report on Form 8-K as filed on July 6, 2011
)
|
|
|
4.5(a)
|
First Amendment to the Prudential Facility, dated as of July 25, 2014, between the Company and Prudential Investment Management, Inc. (incorporated by reference to
Exhibit 4.1 to the Current Report on Form 8-K as filed on November 12, 2014
)
|
|
|
4.5(b)
|
Second Amendment to the Prudential Facility, dated as of September 28, 2015, between the Company and Prudential Investment Management, Inc. (incorporated by reference to
Exhibit 10.2 to the Current Report on Form 8-K as filed on October 2, 2015
)
|
|
|
4.6
|
$50,000,000 Note Purchase Agreement, dated as of September 24, 2007, by and among the Company, New York Life Insurance Company and New York Life Insurance and Annuity Company (incorporated by reference to
Exhibit 4.8 to the Annual Report on Form 10-K as filed on December 10, 2007
)
|
|
|
4.6(a)
|
First Amendment to Note Purchase Agreement, dated as of September 28, 2015, by and among the Company, New York Life Insurance Company and New York Life Insurance and Annuity Company (incorporated by reference to
Exhibit 10.5 to the Current Report on Form 8-K, as filed on October 2, 2015
)
|
|
|
4.7
|
$125,000,000 Note Purchase Agreement, dated as of May 15, 2008 (“2008 NPA
”
), by and among New Jersey Natural Gas Company and the Purchasers party thereto (incorporated by reference to
Exhibit 4.9 to the Current Report on Form 8-K, as filed on May 20, 2008
)
|
|
|
Exhibit
Number
|
Exhibit Description
|
|
|
4.7(a)
|
First Amendment to the 2008 NPA, dated as of September 1, 2014, by and among New Jersey Natural Gas Company and the Purchasers party thereto (incorporated by reference to
Exhibit 99.1 to the Current Report on Form 8-K, as filed on September 30, 2014
)
|
|
|
4.8
|
$100,000,000 Shelf Note Purchase Agreement, dated as of May 12, 2011, between New Jersey Resources Corporation and Metropolitan Life Insurance Company (incorporated by reference to
Exhibit 4.1 to the Current Report on Form 8-K as filed on May 17, 2011
)
|
|
|
4.8(a)
|
First Amendment to the $100,000,000 Shelf Note Purchase Agreement, dated as of September 28, 2015, between New Jersey Resources Corporation and Metropolitan Life Insurance (incorporated by reference to
Exhibit 10.4 to the Current Report on Form 8-K, as filed on October 2, 2015
)
|
|
|
4.9
|
$125,000,000 Note Purchase Agreement, dated as of February 7, 2014, by and among New Jersey Natural Gas Company and the Purchasers party thereto (incorporated by reference to
Exhibit 4.5 to the Quarterly Report on Form 10-Q, as filed on May 7, 2014
)
|
|
|
4.10
|
Loan Agreement between New Jersey Economic Development Authority and New Jersey Natural Gas Company, dated as of August 1, 2011 (incorporated by reference to
Exhibit 4.10 to the Annual Report on Form 10-K for the year ended September 30, 2011, as filed on November 23, 2011
)
|
|
|
4.11
|
Continuing Covenant Agreement between NJNG and Wells Fargo Municipal Strategies, LLC, dated September 24, 2014 (incorporated by reference to
Exhibit 99.4 to the Current Report on Form 8-K, as filed on September 30, 2014
)
|
|
|
4.12
|
$50,000,000 Note Purchase Agreement, dated as of February 8, 2013, by and among New Jersey Natural Gas Company and the Purchasers party thereto (incorporated by reference to
Exhibit 4.12 to the Quarterly Report on Form 10-Q, as filed on May 3, 2013
)
|
|
|
4.13
|
$150,000,000 Note Purchase Agreement, dated as of February 12, 2015, by and among New Jersey Natural Gas Company and the Purchasers party thereto (incorporated by reference to
Exhibit 4.1 to the Current Report on Form 8-K, as filed on February 17, 2015
)
|
|
|
4.14
|
Note Purchase Agreement, dated as of March 22, 2016, among New Jersey Resources Corporation and each of the Purchasers listed in Schedule A thereto (incorporated by reference to
Exhibit 4.1 to the Current Report on Form 8-K, as filed on March 25, 2016
)
|
|
|
4.15
|
$125,000,000 Note Purchase Agreement, dated as of June 21, 2016, by and among New Jersey Natural Gas Company and the Purchasers party thereto (incorporated by reference to
Exhibit 4.1 to the Current Report on Form 8-K, as filed on June 22, 2016
)
|
|
|
4.16
|
$100,000,000 Credit Agreement, dated as of August 18, 2017, between New Jersey Resources Corporation and U.S. Bank National Association, as Agent (incorporated by reference to
Exhibit 10.1 to the Current Report on Form 8-K as filed on August 18, 2017
)
|
|
|
10.1*
|
Amended and Restated Supplemental Executive Retirement Plan Agreement between the Company and Laurence M. Downes dated November 28, 2008 (incorporated by reference to
Exhibit 10.4 to the Quarterly Report on Form 10-Q, as filed on February 6, 2009
)
|
|
|
10.2(a)*
|
Schedule of Supplemental Executive Retirement Plan Agreements for named executive officers (incorporated by reference to
Exhibit 10.2(a) to the Annual Report on Form 10-K for the year ended September 30, 2010, as filed on November 24, 2010
)
|
|
|
10.2(b)*
|
Form of Amendment to Supplemental Executive Retirement Plan Agreement between the Company and Named Executive Officer (for future use) (incorporated by reference to
Exhibit 10.4(b) to the Quarterly Report on Form 10-Q, as filed on February 6, 2009
)
|
|
|
10.3
|
Service Agreement for Rate Schedule SS-1 by and between NJNG and Texas Eastern Transmission Company, dated as of June 21, 1995 (incorporated by reference to
Exhibit 10-5B to the Annual Report on Form 10-K for the year ended September 30, 1996, as filed on December 30, 1996
)
|
|
|
10.4
|
Amended and Restated Lease Agreement between NJNG, as Lessee, and State Street Bank and Trust Company of Connecticut, National Association, as Lessor, for NJNG’s Headquarters Building dated December 21, 1995 (incorporated by reference to
Exhibit 10-7 to the Annual Report on Form 10-K for the year ended September 30, 1996, as filed on December 30, 1996
)
|
|
|
Exhibit
Number
|
Exhibit Description
|
|
|
10.5*
|
Employment Continuation Agreement between the Company and Laurence M. Downes dated November 28, 2008 (incorporated by reference to
Exhibit 10.12 to the Quarterly Report on Form 10-Q, as filed on February 6, 2009
)
|
|
|
10.5(a)*
|
Schedule of Employee Continuation Agreements (incorporated by reference to
Exhibit 10.6(a) to the Annual Report on Form 10-K for the year ended September 30, 2010, as filed on November 24, 2010
)
|
|
|
10.7*
|
Summary of Company’s Non-Employee Director Compensation (incorporated by reference to
Exhibit 10.1 to the Current Report on Form 8-K as filed on November 17, 2017
)
|
|
|
10.8*
|
The Company’s 2007 Stock Award and Incentive Plan (as amended and restated January 1, 2009) (incorporated by reference to
Exhibit 10.17 to the Quarterly Report on Form 10-Q, as filed on February 6, 2009
)
|
|
|
10.9*
|
2007 Stock Award and Incentive Plan Form of Performance Shares Agreement (TSR) (incorporated by reference to
Exhibit 10.1 to the Current Report on Form 8-K, as filed on December 23, 2014
)
|
|
|
10.10*
|
2007 Stock Award and Incentive Plan Form of Performance Share Units Agreement (TSR) (incorporated by reference to
Exhibit 10.4 to the Quarterly Report on Form 10-Q, as filed on February 8, 2017
)
|
|
|
10.11*
|
2007 Stock Award and Incentive Plan Form of Performance Shares Agreement (NFE) (incorporated by reference to
Exhibit 10.2 to the Current Report on Form 8-K, as filed on December 23, 2014
)
|
|
|
10.12*
|
2007 Stock Award and Incentive Plan Form of Performance Share Units Agreement (NFE) (incorporated by reference to
Exhibit 10.2 to the Quarterly Report on Form 10-Q, as filed on February 8, 2017
)
|
|
|
10.13*
|
2007 Stock Award and Incentive Plan Form of Performance-Based Restricted Stock Agreement (FY 2015) (incorporated by reference to
Exhibit 10.5 to the Current Report on Form 8-K, as filed on December 23, 2014
)
|
|
|
10.14*
|
2007 Stock Award and Incentive Plan Form of Performance-Based Restricted Stock Units Agreement (incorporated by reference to
Exhibit 10.5 to the Quarterly Report on Form 10-Q, as filed on February 8, 2017
)
|
|
|
10.15*
|
2007 Stock Award and Incentive Plan Form of Deferred Stock Retention Award Agreement (incorporated by reference to
Exhibit 10.3 to the Current Report on Form 8-K, as filed on December 23, 2014
)
|
|
|
10.16*
|
Form of Amendment of Deferred Stock Retention Award Agreement (incorporated by reference to
Exhibit 10.1 to the Quarterly Report on Form 10-Q, as filed on August 3, 2016
)
|
|
|
10.17*
|
2007 Stock Award and Incentive Plan Form of Deferred Stock Retention Award Agreement (incorporated by reference to
Exhibit 10.3 to the Quarterly Report on Form 10-Q, as filed on February 8, 2017
)
|
|
|
10.18*
|
2007 Stock Award and Incentive Plan Form of Restricted Stock Agreement (incorporated by reference to
Exhibit 10.4 to the Current Report on Form 8-K, as filed on December 23, 2014
)
|
|
|
10.19*
|
2007 Stock Award and Incentive Plan Form of Restricted Stock Units Agreement (incorporated by reference to
Exhibit 10.6 to the Quarterly Report on Form 10-Q, as filed on February 8, 2017
)
|
|
|
10.20*
|
The Company’s 2017 Stock Award and Incentive Plan (incorporated by reference to
Appendix A to the Proxy Statement for the 2017 Annual Meeting as filed on December 15, 2016
)
|
|
|
10.21+*
|
|
|
|
10.22*
|
New Jersey Resources Corporation Pension Equalization Plan (incorporated by reference to
Exhibit 10.28 to the Quarterly Report on Form 10-Q, as filed on February 6, 2009
)
|
|
|
10.23*
|
New Jersey Resources Corporation Directors’ Deferred Compensation Plan (incorporated by reference to
Exhibit 10.25 to the Quarterly Report on Form 10-Q, as filed on February 6, 2009
)
|
|
|
10.24*
|
New Jersey Resources Corporation Officers’ Deferred Compensation Plan (incorporated by reference to
Exhibit 10.26 to the Quarterly Report on Form 10-Q, as filed on February 6, 2009
)
|
|
|
10.25*
|
Form of Amended and Restated Employment Continuation Agreement between the Company and NJR Energy Services Company named executive officer (incorporated by reference to
Exhibit 10.2 to the Current Report on Form 8-K, as filed on December 16, 2015
)
|
|
|
10.26*
|
Form of Amended and Restated Employment Continuation Agreement between the Company and named executive officer (incorporated by reference to
Exhibit 10.1 to the Current Report on Form 8-K, as filed on December 16, 2015
)
|
|
|
Exhibit
Number
|
Exhibit Description
|
|
|
10.27+*
|
|
|
|
10.28
|
Limited Liability Company Agreement of Steckman Ridge GP, LLC, dated as of March 2, 2007 (incorporated by reference to
Exhibit 10.1 to the Quarterly Report on Form 10-Q, as filed on May 3, 2007
)
|
|
|
10.29
|
Limited Partnership Agreement of Steckman Ridge, LP dated as of March 2, 2007 (incorporated by reference to
Exhibit 10.2 to the Quarterly Report on Form 10-Q, as filed on May 3, 2007
)
|
|
|
21.1+
|
|
|
|
23.1+
|
|
|
|
31.1+
|
|
|
|
31.2+
|
|
|
|
32.1+ †
|
|
|
|
32.2+ †
|
|
|
|
101+
|
Interactive Data File {Annual Report on Form 10-K, for the fiscal year ended September 30, 2017, furnished in XBRL (eXtensible Business Reporting Language)}
|
+
|
Filed herewith.
|
*
|
Denotes compensatory plans or arrangements or management contracts.
|
†
|
This certificate accompanies this report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by NJR for purposes of Section 18 or any other provision of the Securities Exchange Act of 1934, as amended.
|
|
|
NEW JERSEY RESOURCES CORPORATION
|
|
|
(Registrant)
|
|
|
|
Date:
|
November 21, 2017
|
By:/s/ Patrick Migliaccio
|
|
|
Patrick Migliaccio
|
|
|
Senior Vice President and
|
|
|
Chief Financial Officer
|
November 21, 2017
|
/s/ Laurence M. Downes
|
November 21, 2017
|
/s/ Patrick J. Migliaccio
|
|
Laurence M. Downes
Chairman, President and
Chief Executive Officer
Director
|
|
Patrick J. Migliaccio
Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer) |
|
|
|
|
November 21, 2017
|
/s/ Maureen A. Borkowski
|
November 21, 2017
|
/s/ Thomas C. O'Connor
|
|
Maureen A. Borkowski
Director
|
|
Thomas C. O'Connor
Director
|
|
|
|
|
November 21, 2017
|
/s/ Lawrence R. Codey
|
November 21, 2017
|
/s/ J. Terry Strange
|
|
Lawrence R. Codey
Director |
|
J. Terry Strange
Director
|
|
|
|
|
November 21, 2017
|
/s/ Donald L. Correll
|
November 21, 2017
|
/s/ Sharon C. Taylor
|
|
Donald L. Correll
Director |
|
Sharon C. Taylor
Director
|
|
|
|
|
November 21, 2017
|
/s/ Robert B. Evans
|
November 21, 2017
|
/s/ David A. Trice
|
|
Robert B. Evans
Director |
|
David A. Trice
Director
|
|
|
|
|
November 21, 2017
|
/s/ M. William Howard, Jr.
|
November 21, 2017
|
/s/ George R. Zoffinger
|
|
M. William Howard, Jr.
Director |
|
George R. Zoffinger
Director
|
|
|
|
|
November 21, 2017
|
/s/ Jane M. Kenny
|
|
|
|
Jane M. Kenny
Director |
|
|
ARTICLE I DEFINITIONS
|
1
|
|
|
ARTICLE II PARTICIPATION
|
5
|
|
|
|
2.01 Participation
|
5
|
|
|
2.02 Termination of Participation
|
5
|
|
ARTICLE III EMPLOYER CONTRIBUTIONS
|
6
|
|
|
|
3.01 Accounts
|
6
|
|
|
3.02 Amount of Supplemental Employer Matching Contributions
|
6
|
|
|
3.03 Deemed Interest
|
7
|
|
|
3.04 Vesting of Account
|
7
|
|
ARTICLE IV PAYMENT OF ACCOUNT
|
9
|
|
|
|
4.01 Payment of Account Upon Separation from Service
|
9
|
|
|
4.02 Death Benefits
|
9
|
|
|
4.03 Timing of Payment for a “Specified Employee”
|
10
|
|
|
4.04 Delay of Payment
|
10
|
|
ARTICLE V PLAN ADMINISTRATION
|
12
|
|
|
|
5.01 Administration
|
12
|
|
|
5.02 Claims Procedures
|
13
|
|
|
5.03 Expenses
|
17
|
|
ARTICLE VI GENERAL PROVISIONS
|
18
|
|
|
|
6.01 Funding
|
18
|
|
|
6.02 Discontinuance and Amendment
|
19
|
|
|
6.03 Termination of Plan
|
19
|
|
|
6.04 Plan Not a Contract of Employment
|
19
|
|
|
6.05 Facility of Payment
|
20
|
|
|
6.06 Withholding Taxes
|
20
|
|
|
6.07 Nonalienation
|
20
|
|
|
6.08 Construction
|
21
|
|
1.01
|
Accounts
shall mean the Grandfathered Account and the 409A Account maintained on the books of the Corporation on behalf of each Participant pursuant to this Plan.
|
1.02
|
Affiliate
shall mean any division, subsidiary or affiliated company of the Corporation, which is an “Affiliate” as defined in the Qualified Plan but only to the extent such “Affiliate” is treated as a single employer with the Corporation for purposes of the applicable provisions of Code Section 409A (using “at least 50 percent” instead of “at least 80%” where applicable to make that determination).
|
1.03
|
Beneficiary
shall mean the person or persons to whom a deceased Participant’s benefits are payable, as provided in Section 4.02.
|
1.05
|
Committee
shall mean the Benefit Administration Committee of the Corporation or any successor thereto.
|
1.06
|
Corporation
shall mean New Jersey Resources Corporation, or any successor by merger, purchase or otherwise.
|
(a)
|
who is employed by the Corporation or a wholly-owned subsidiary of the Corporation and
|
(b)
|
who qualifies as a highly compensated or management level employee within the meaning of Sections 201, 301 and 401 of ERISA.
|
1.09
|
Employer Matching Contributions
shall mean “Employer Matching Contributions” as such term is defined under the Qualified Plan.
|
1.10
|
ERISA
shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time.
|
1.11
|
409A Account
shall mean the bookkeeping account (or subaccounts thereof) maintained for each Participant to record all amounts credited on his or her behalf under Section 3.02 on or after January 1, 2005 and any related deemed interest on such amounts and all amounts credited to his or her Accounts as of December 31, 2004 in which he or she was not vested as of December 31, 2004 and any related deemed interest on such amounts.
|
1.12
|
Grandfathered Account
shall mean the bookkeeping account (or subaccounts thereof) maintained for each Participant to record the amounts credited on his or her behalf under Section 3.02 prior to January 1, 2005 in which the Participant has a nonforfeitable right to as of December 31, 2004, and any related deemed interest on such amounts, determined without regard to any Plan amendments after October 3, 2004 that would constitute a material modification of the Plan for Code Section 409A purposes.
|
1.13
|
Participant
shall mean an Eligible Employee who is selected by the Committee to participate in the Plan pursuant to Section 2.01 hereof.
|
1.14
|
Plan
shall mean the Savings Equalization Plan of New Jersey Resources Corporation, as set forth herein or as amended from time to time.
|
1.15
|
Plan Year
shall mean the calendar year.
|
1.16
|
Qualified Plan
shall mean the New Jersey Resources Corporation Employees’ Retirement Savings Plan, as amended from time to time.
|
1.17
|
Separation from Service
shall mean the death of a Participant or the retirement or other termination of employment of the Participant such that he or she ceases to be an employee of the Corporation and all Affiliates, provided that no change in a Participant’s employment status shall be considered
|
1.18
|
Spouse
shall mean the individual to whom the Participant is legally married under applicable law at the applicable time.
|
1.19
|
Supplemental Employer Matching Contributions
shall mean the amount credited to an Eligible Employee under Section 3.01.
|
1.20
|
Valuation Date
shall mean the last day of each calendar quarter and such other day or days as the Committee may select. All distributions under the Plan shall be based upon the value of the Participant’s Account as of the Valuation Date specified in Article IV with respect to the distribution.
|
(a)
|
the Employer Matching Contributions that would have been made to the Participant’s “Employer Account” (as such term is defined under the Qualified Plan) under the Qualified Plan, determined on the basis that the Participant’s “Pre-Tax Contributions” and “After-Tax Contributions” (as such terms are defined in the Qualified Plan) under the Qualified Plan were made without regard to the limitations imposed under the Qualified Plan by Section 401(a)(17) of the Code, by the actual deferral percentage test under Section 401(k) of the Code, or the actual contribution percentage test under Section 401(m) of the Code, or by Section 415 of the Code;
|
(b)
|
the Employer Matching Contributions actually made to the Participant’s “Employer Account” (as such term is defined under the Qualified Plan) under the Qualified Plan, determined with regard to the limitations imposed by Section 401(a)(17) of the Code, by
|
(a)
|
the amount credited to a Participant’s Account under the Plan as of the end of the prior calendar quarter shall be credited with interest for that calendar quarter at one-quarter of the prime rate as published in the Wall Street Journal on the last day of such calendar quarter, such prime rate first rounded to the nearest .25%; and
|
(b)
|
the amount credited to a Participant’s Account under the Plan during the calendar quarter shall be credited with interest for that calendar quarter at one-eighth of the prime rate as published in the Wall Street Journal on the last day of such calendar quarter, such prime rate first rounded to the nearest .25%.
|
(a)
|
A Participant shall be vested in, and have a nonforfeitable right to, his or her Account in accordance with the following schedule based on the Participant’s years of “Service” (as such term is defined in the Qualified Plan):
|
Years of Service
|
Vested Percentage
|
Less than 2 years
|
0%
|
2 years but less than 3 years
|
25%
|
3 years but less than 4 years
|
50%
|
4 years but less than 5 years
|
75%
|
5 years or more
|
100%
|
(b)
|
Notwithstanding the provisions of paragraph (a) above, a Participant shall be 100% vested in, and have a nonforfeitable right to, his or her Account if, prior to his or her termination of employment with the Corporation and its Affiliates, the Participant either attains age 65, dies, or incurs a Disability (as such term is defined in the Qualified Plan).
|
(c)
|
Upon termination of employment with the Corporation and its Affiliates of a Participant who is not 100% vested in his or her Account, the nonvested portion of the Participant’s Account shall be forfeited.
|
(a)
|
the Participant’s Spouse;
|
(b)
|
the Participant’s children, in equal shares, per stirpes;
|
(c)
|
the Participant’s parents;
|
(d)
|
the person(s) designated as beneficiary by the Participant under any group life insurance maintained by the Corporation or any of its Affiliates; and
|
(e)
|
the Participant’s estate.
|
(a)
|
The administration of the Plan, the exclusive power and complete discretionary authority to interpret it, and the responsibility for carrying out its provisions are vested in the Committee or its delegate(s). The Committee shall have the complete discretionary authority to administer the Plan and resolve any question under the Plan. The determination of the Committee as to the interpretation of the Plan or any disputed question shall be conclusive and final to the extent permitted by applicable law. The Committee may employ and rely on such legal counsel, actuaries, accountants and agents as it may deem advisable to assist in the administration of the Plan.
|
(b)
|
The Committee may appoint and delegate to any one or more members of the Committee, or any officer of the Corporation or other individual, any or all of the authority of the Committee with respect to the administration of the Plan, the power and authority to interpret it and the responsibility for carrying out any of the provisions of the Plan otherwise vested in the Committee, subject to such terms as the Committee shall determine. The Committee may revoke or amend the terms of any such delegation at any time but such action shall not invalidate any prior actions of the Committee's delegate or delegates that were consistent with the terms of the Plan and the Committee's prior delegation of authority.
|
(c)
|
To the extent permitted by law, all agents, delegates and representatives of the Committee shall be indemnified by the Corporation and held harmless against any claims and the expenses of defending against such claims, resulting from any action or conduct relating to the administration of the Plan, except claims arising from gross negligence, willful neglect or willful misconduct.
|
(a)
|
All claims for benefits under the Plan shall be submitted in writing to the Committee. The Committee shall review the claim when filed and advise the claimant as to whether the claim is approved or denied. If the claim is wholly or partially denied, the Committee shall furnish a written denial within a reasonable period of time. Notwithstanding the foregoing, any written denial (other than a denial of benefits based on a determination of Disability, where Disability is determined other than through the Corporation’s long-term disability plan or the Social Security Administration (a “Disability claim”)) shall be furnished within ninety (90) days after receipt of the filed claim unless special circumstances require an extension of time for processing the claim. If the Committee determines that special circumstances require an extension of time for processing a claim (other than a Disability claim) is required, written notice of the extension shall be furnished to the claimant prior to the expiration of the initial ninety (90) day period, which shall indicate the special circumstances requiring an extension of time and the date by which the Plan expects to render a decision. In such case, the Committee shall furnish the written denial within one hundred eighty (180) days after receipt of the filed claim. Any written denial of a Disability claim shall be furnished within forty-five (45) days after receipt of the claim. This forty-five (45)-day period may be extended up to thirty (30) days if such an extension is necessary due to matters beyond the control of the Plan, and the claimant is notified, prior to the expiration of the initial forty-five (45)-day period, of the circumstances requiring the extension of time and the date by which the Plan expects to render a decision. If, prior to the end of the first thirty (30) day extension period, the Committee determines that, due to matters beyond the control of the Plan, a decision cannot be rendered within that extension period, the period for making the determination may be extended for up to an additional thirty (30) days, provided that the Committee notifies the claimant, prior to the expiration of the first thirty (30) days extension
|
(b)
|
If a claim for a benefit under the Plan is denied in whole or in part, the claimant shall be provided a written notice of the denial. The written denial shall contain (a) the specific reason or reasons for denial; (b) specific reference to pertinent Plan provisions on which the denial is based; (c) a description of any additional information necessary for the claimant to perfect the claim and an explanation of why such material or information is necessary; and (d) appropriate information as to the steps to be taken if the claimant wishes to appeal the denial of the claim including time limits applicable to the appeal procedures, including a statement of the claimant’s right to bring a civil action following a claim denial. With respect to a Disability claim, if an internal rule, guideline, protocol, or other similar criterion was relied upon in making the adverse determination, either the specific rule, guideline, protocol, or other similar criterion shall be provided to the claimant free of charge, or the claimant shall be informed that such rule, guideline, protocol, or other criterion shall be provided free of charge upon request.
|
(c)
|
The Participant may appeal the denial of the claim to the Committee within ninety (90) days after receipt of the adverse benefit determination one hundred eighty (180) days in the case of a Disability claim). The appeal shall be in writing addressed to the Committee and shall state the reason why the Committee should grant the appeal. The claimant may submit written comments, documents, records, and other information relating to his claim for
|
(d)
|
The Committee shall conduct a full and fair review of the claim that takes into account all comments, documents, records, and other information submitted by the claimant or his authorized representative relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination. The review of a Disability claim shall not afford deference to the initial benefit determination and shall be conducted by an individual who is neither the individual who made the adverse benefit determination that is the subject of the appeal, nor the subordinate of such individual. With respect to a Disability claim, the Committee shall consult a medical professional who has appropriate training and experience in the field of medicine relating to the claimant’s Disability and who is neither consulted as part of the initial denial nor is the subordinate to such individual and shall identify the medical or vocational experts whose advice is obtained with respect to the initial benefit denial, without regard to whether the advice was relied upon in making the decisions. If a Disability claim is denied due to a medical judgment, the Committee will consult with a healthcare professional who has appropriate training and experience in the field of medicine involved in the medical judgment. The healthcare professional consulted will not be the same person consulted in connection with the initial benefit decision (nor be the subordinate of that person). The decision on review also will identify any medical or vocational experts who advised the Committee in connection with the original benefit decision, even if the advice was not relied upon in making the decision. The Committee shall issue its decision within sixty (60) days (forty-five (45) days in the case of a Disability claim) of the receipt of the appeal unless there are special circumstances that require an extension of time for processing the claim. If the Committee determines that an extension of time for processing is required, the Committee shall notify the claimant in writing prior
|
(e)
|
If the Committee denies the claim on appeal, it shall notify the claimant in writing, stating the reasons for the denial in a manner calculated to be understood by the participant, and shall make specific references to the pertinent Plan provisions on which the decision is based. The notification of the benefit determination also must include a statement of the claimant’s right to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the claimant’s claim for benefits and to bring a civil action. If an internal rule, guideline, protocol, or other similar criterion was relied upon in making the adverse determination with respect to a Disability claim, either the specific rule, guideline, protocol, or other similar criterion shall be provided free of charge, or the claimant may be informed that such rule, guideline, protocol, or other criterion shall be provided free of charge upon request. The Committee’s decision upon appeal, or the Committee’s initial decision if no appeal is taken, shall be final, conclusive and binding on all parties.
|
(f)
|
In no event will a Participant or beneficiary be entitled to challenge the Committee’s decision in court or in any other administrative proceeding unless and until these claims review procedures have been complied with and exhausted. The claimant then shall have ninety (90) days from the date of receipt of the Committee’s decision on appeal in which to file suit regarding a claim for benefits under the Plan. If suit is not filed within such ninety (90)-day period, it shall be forever barred.
|
(a)
|
All amounts payable in accordance with the Plan shall constitute a general unsecured obligation of the Corporation. Such amounts, as well as any administrative costs relating to the Plan, shall be paid out of the general assets of the Corporation, to the extent not paid from the assets of any trust established pursuant to paragraph (b) below.
|
(b)
|
The Corporation may, for administrative reasons, establish a grantor trust for the benefit of Participants in the Plan. The assets placed in said trust shall be held separate and apart from other Corporation funds and shall be used exclusively for the purposes set forth in the Plan and the applicable trust agreement, subject to the following conditions:
|
(i)
|
the creation of said trust shall not cause the Plan to be other than "unfunded" for purposes of Title I of ERISA;
|
(ii)
|
the Corporation shall be treated as "grantor" of said trust for purposes of Section 677 of the Code;
|
(iii)
|
the agreement of said trust shall provide that its assets may be used upon the insolvency or bankruptcy of the Corporation to satisfy claims of the Corporation's general creditors and that the rights of such general creditors are enforceable by them under federal and state law;
|
(iv)
|
the trust shall be sited in the United States;
|
(v)
|
the funding of the trust shall not be contingent on the financial condition of the Corporation; and
|
(vi)
|
the trust shall always comply with the provisions of Code Section 409A(b).
|
(a)
|
The Plan is intended to constitute an unfunded deferred compensation arrangement maintained for a select group of management or highly compensated employees within the meaning of Section 201(2), Section 301(a)(3), and Section 401(a)(1) of ERISA, and all rights under the Plan shall be governed by ERISA. Subject to the preceding sentence, the Plan shall be construed, regulated and administered under the laws of the State of New Jersey to the extent such laws are not superseded by applicable federal law. The Plan shall be construed and interpreted to meet the applicable requirements of Code Section 409A to avoid a plan failure described in Code Section 409A(a)(1). The Committee is authorized to adopt rules or regulations deemed necessary or appropriate in connection therewith to anticipate and/or comply the requirements of Code Section 409A and to declare any election, consent or modification thereto void if non‑compliant with Code Section 409A. The Committee, the Corporation and any related parties shall not be responsible for the payment of any taxes or related penalties or interest for any failure to comply with Code Section 409A.
|
(b)
|
The masculine pronoun shall mean the feminine wherever appropriate.
|
(c)
|
The illegality of any particular provision of this document shall not affect the other provisions and the document shall be construed in all respects as if such invalid provision were omitted.
|
(d)
|
The headings and subheadings in the Plan have been inserted for convenience of reference only, and are to be ignored in any construction of the provisions thereof.
|
•
|
Information regarding NJNG's rate structure, tariff design, sales volumes, margins, and marketing strategies;
|
•
|
Strategic plans;
|
•
|
Allocation of resources for new initiatives;
|
•
|
Confidential competitive intelligence;
|
•
|
Regulatory relationship strengths and weaknesses;
|
•
|
Regulatory strategy;
|
•
|
Government affairs plans and strategies;
|
•
|
Information on staffing, finance, employee performance, and compensation of others;
|
•
|
Litigation strategies, including, but not limited to, rate case strategies;
|
•
|
Information, plans and strategies related to the construction and/or operation of natural gas transmission and/or distribution infrastructure, including, but not limited to, the PennEast pipeline and/or the NJNG Southern Reliability Link pipeline;
|
•
|
Customer information;
|
•
|
Attorney-client communications; and/or
|
•
|
Attorney work product.
|
/s/Amanda E. Mullan
|
Amanda E. Mullan
|
Chief Human Resources Officer
|
/s/Mariellen Dugan
|
Mariellen Dugan
|
August 18, 2017
|
Date
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/s/Edward Cerasia II
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Witness
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/s/Mariellen Dugan
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/s/Edward Cerasia II
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Mariellen Dugan
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Witness (signature)
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August 18, 2017
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Edward Cerasia II
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Date
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Witness (print name)
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SUBSIDIARY
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STATE OF INCORPORATION
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New Jersey Natural Gas Company
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New Jersey
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NJR Service Corporation
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New Jersey
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NJR Energy Services Company
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New Jersey
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NJR Clean Energy Ventures Corporation
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New Jersey
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Subsidiary:
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NJR Clean Energy Ventures II Corporation
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New Jersey
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Subsidiaries:
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Two Dot Wind Farm, LLC (Limited Liability Company)
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Delaware
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Carroll Area Wind Farm, LLC (Limited Liability Company)
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Iowa
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Alexander Wind Farm, LLC (Limited Liability Company)
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Delaware
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Ringer Hill Wind, LLC (Limited Liability Company)
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Delaware
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Bernards Solar, LLC (Limited Liability Company)
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New Jersey
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Medicine Bow Wind, LLC (Limited Liability Company)
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Delaware
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NJR Clean Energy Ventures III Corporation
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New Jersey
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NJR Energy Investments Corporation
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New Jersey
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Subsidiaries:
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NJR Midstream Holdings Corporation
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New Jersey
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Subsidiaries:
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NJNR Pipeline Company
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New Jersey
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NJR Pipeline Company
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New Jersey
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Subsidiary:
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Adelphia Gateway, LLC (Limited Liability Company)
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Delaware
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NJR Storage Holdings Company
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Delaware
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Subsidiary:
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NJR Steckman Ridge Storage Company
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Delaware
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NJR Retail Holdings Corporation
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New Jersey
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Subsidiaries:
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Commercial Realty and Resources Corporation
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New Jersey
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NJR Retail Services Company
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New Jersey
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NJR Home Services Company
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New Jersey
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Subsidiary:
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NJR Plumbing Services, Inc
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New Jersey
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1)
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I have reviewed this report on Form
10-K
of New Jersey Resources Corporation;
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2)
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3)
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4)
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The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5)
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The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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Date:
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November 21, 2017
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By:
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/s/ Laurence M. Downes
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Laurence M. Downes
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Chairman, President & Chief Executive Officer
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1)
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I have reviewed this report on Form
10-K
of New Jersey Resources Corporation;
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2)
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3)
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4)
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The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5)
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The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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Date:
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November 21, 2017
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By:
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/s/ Patrick Migliaccio
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Patrick Migliaccio
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Senior Vice President and Chief Financial Officer
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(a)
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I am the Chief Executive Officer of New Jersey Resources Corporation (the "Company");
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(b)
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To the best of my knowledge, this annual report on Form
10-K
for the fiscal year ended
September 30, 2017
, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
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(c)
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To the best of my knowledge, based upon a review of this report, the information contained in this periodic report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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Date:
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November 21, 2017
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By:
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/s/ Laurence M. Downes
|
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|
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Laurence M. Downes
|
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|
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Chairman, President and Chief Executive Officer
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(a)
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I am the Chief
Financial
Officer of New Jersey Resources Corporation (the "Company");
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(b)
|
To the best of my knowledge, this annual report on Form
10-K
for the fiscal year ended
September 30, 2017
, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
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(c)
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To the best of my knowledge, based upon a review of this report, the information contained in this periodic report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
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November 21, 2017
|
By:
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/s/ Patrick Migliaccio
|
|
|
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Patrick Migliaccio
|
|
|
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Senior Vice President and Chief Financial Officer
|