|
Large accelerated filer:
x
|
|
|
Accelerated filer:
o
|
Non-accelerated filer:
o
|
|
|
Smaller reporting company:
o
|
|
|
|
Emerging growth company:
o
|
|
|
|
|
Page
|
PART I
|
|
||
|
ITEM 1.
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
ITEM 1A.
|
||
|
ITEM 1B.
|
||
|
ITEM 2.
|
||
|
ITEM 3.
|
||
|
ITEM 4.
|
||
|
ITEM 4A.
|
||
PART II
|
|
||
|
ITEM 5.
|
||
|
ITEM 6.
|
||
|
ITEM 7.
|
||
|
ITEM 7A.
|
||
|
ITEM 8.
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
ITEM 9.
|
||
|
ITEM 9A.
|
||
|
ITEM 9B.
|
||
PART III*
|
|
||
|
ITEM 10.
|
||
|
ITEM 11.
|
||
|
ITEM 12.
|
||
|
ITEM 13.
|
||
|
ITEM 14.
|
||
PART IV
|
|
||
|
ITEM 15.
|
||
|
|
||
|
|
||
|
|
||
* Portions of Item 10 and Items 11-14 are Incorporated by Reference from the Proxy Statement.
|
Adelphia
|
Adelphia Gateway, LLC
|
AFUDC
|
Allowance for Funds Used During Construction
|
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 Energy Midstream Partners, L.P., a master limited partnership
|
DM Common Units
|
Common units representing limited partnership interests in DM
|
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
|
EDECA
|
Electric Discount and Energy Competition Act
|
EE
|
Energy Efficiency
|
FASB
|
Financial Accounting Standards Board
|
FCM
|
Futures Commission Merchant
|
FERC
|
Federal Energy Regulatory Commission
|
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
|
FMB
|
First Mortgage Bonds
|
GAAP
|
Generally Accepted Accounting Principles of the United States
|
HCCTR
|
Health Care Cost Trend Rate
|
Home Services and Other
|
Home Services and Other Operations (formerly Retail and Other Operations)
|
ICE
|
Intercontinental Exchange
|
IEC
|
Interstate Energy Company, LLC
|
Iroquois
|
Iroquois Gas Transmission L.P.
|
IRS
|
Internal Revenue Service
|
ISDA
|
The International Swaps and Derivatives Association
|
ITC
|
Investment Tax Credit
|
LIBOR
|
London Inter-Bank Offered Rate
|
LNG
|
Liquefied Natural Gas
|
Loan Agreement
|
Loan Agreement between the EDA and NJNG
|
MGP
|
Manufactured Gas Plant
|
MLP
|
Master Limited Partnership
|
MMBtu
|
Million British Thermal Units
|
Moody’s
|
Moody’s Investors Service, Inc.
|
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
|
NFE
|
Net Financial Earnings
|
NJ RISE
|
New Jersey Reinvestment in System Enhancement
|
NJCEP
|
New Jersey’s Clean Energy Program
|
NJDEP
|
New Jersey Department of Environmental Protection
|
NJNG
|
New Jersey Natural Gas Company or Natural Gas Distribution segment
|
NJNG Credit Facility
|
The $250 million unsecured committed credit facility expiring in May 2019
|
NJR Credit Facility
|
The $425 million unsecured committed credit facility expiring in September 2020
|
NJR or The Company
|
New Jersey Resources Corporation
|
GLOSSARY OF KEY TERMS (cont.)
|
|
|
|
NJRCEV
|
NJR Clean Energy Ventures Corporation
|
NJRES
|
NJR Energy Services Company
|
NJRHS
|
NJR Home Services Company
|
NJRRS
|
NJR Retail Services Company
|
Non-GAAP
|
Not in accordance with Generally Accepted Accounting Principles of the United States
|
NPNS
|
Normal Purchase/Normal Sale
|
NYMEX
|
New York Mercantile Exchange
|
O&M
|
Operation and Maintenance
|
OPEB
|
Other Postemployment Benefit Plans
|
PBO
|
Projected Benefit Obligation
|
PennEast
|
PennEast Pipeline Company, LLC
|
PEP
|
Pension Equalization Plan
|
PIM
|
Pipeline Integrity Management
|
PPA
|
Power Purchase Agreement
|
Prudential Facility
|
NJR’s unsecured, uncommitted private placement shelf note agreement with Prudential Investment Management, Inc.
|
PTC
|
Production Tax Credit
|
RAC
|
Remediation Adjustment Clause
|
REC
|
Renewable Energy Certificate
|
S&P
|
Standard & Poor’s Financial Services, LLC
|
SAFE I
|
Safety Acceleration and Facility Enhancement Program, Phase I
|
SAFE II
|
Safety Acceleration and Facility Enhancement Program, Phase II
|
Sarbanes-Oxley
|
Sarbanes-Oxley Act of 2002
|
SAVEGREEN
|
The SAVEGREEN Project®
|
Savings Plan
|
Employees’ Retirement Savings Plan
|
SBC
|
Societal Benefits Charge
|
SEC
|
Securities and Exchange Commission
|
SREC
|
Solar Renewable Energy Certificate
|
SRL
|
Southern Reliability Link
|
Steckman Ridge
|
Collectively, Steckman Ridge GP, LLC and Steckman Ridge, LP
|
Superstorm Sandy
|
Post-Tropical Cyclone Sandy
|
Talen
|
Talen Energy Marketing, LLC or Talen Generation, LLC
|
Tetco
|
Texas Eastern Transmission
|
The Exchange Act
|
The Securities Exchange Act of 1934, as amended
|
The Tax Act
|
An Act to Provide for Reconciliation Pursuant to Titles II and V of the Concurrent Resolution on the Budget for Fiscal Year 2018, previously known as The Tax Cuts and Jobs Act of 2017
|
Trustee
|
U.S. Bank National Association
|
TSR
|
Total Shareholder Return
|
U.S.
|
The United States of America
|
Union
|
International Brotherhood of Electrical Workers Local 1820
|
USF
|
Universal Service Fund
|
•
|
risks associated with our investments in clean energy projects,
including the availability of regulatory incentives and federal tax credits, the availability of viable projects, our eligibility for ITCs, the future market for SRECs and electricity prices, and operational risks related to projects in service;
|
•
|
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, pipeline transportation systems and NJNG and Midstream infrastructure projects, including NJ RISE, SRL, PennEast and Adelphia, in a timely manner;
|
•
|
risks associated with acquisitions and the related integration of acquired assets with our current operations, including our planned Adelphia acquisition;
|
•
|
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 our risk management efforts;
|
•
|
our ability to comply with current and future regulatory requirements;
|
•
|
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;
|
•
|
the impact of a disallowance of recovery of environmental-related expenditures and other regulatory changes;
|
•
|
the performance of our subsidiaries;
|
•
|
operating risks incidental to handling, storing, transporting and providing customers with natural gas;
|
•
|
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;
|
•
|
timing of qualifying for ITCs due to delays or failures to complete planned solar 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;
|
•
|
changes in rating agency requirements and/or credit ratings and their effect on availability and cost of capital to our Company;
|
•
|
risks related to cyberattacks or failure of information technology systems;
|
•
|
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;
|
•
|
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;
|
•
|
our ability to optimize our physical assets;
|
•
|
weather and economic conditions;
|
•
|
changes to tax laws and regulations;
|
•
|
any potential need to record a valuation allowance for our deferred tax assets;
|
•
|
our ability to comply with debt covenants;
|
•
|
demographic changes in our
service territory and their effect on our 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;
|
•
|
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.
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Net income
|
$
|
233,436
|
|
$
|
132,065
|
|
$
|
131,672
|
|
Add:
|
|
|
|
||||||
Unrealized loss (gain) on derivative instruments and related transactions
|
26,770
|
|
(11,241
|
)
|
46,883
|
|
|||
Tax effect
|
(4,512
|
)
|
4,062
|
|
(17,018
|
)
|
|||
Effects of economic hedging related to natural gas inventory
|
(22,570
|
)
|
38,470
|
|
(36,816
|
)
|
|||
Tax effect
|
7,362
|
|
(13,964
|
)
|
13,364
|
|
|||
NFE
(1)
|
$
|
240,486
|
|
$
|
149,392
|
|
$
|
138,085
|
|
Basic earnings per share
|
$
|
2.66
|
|
$
|
1.53
|
|
$
|
1.53
|
|
Add:
|
|
|
|
||||||
Unrealized loss (gain) on derivative instruments and related transactions
|
0.31
|
|
(0.13
|
)
|
0.55
|
|
|||
Tax effect
|
(0.05
|
)
|
0.05
|
|
(0.20
|
)
|
|||
Effects of economic hedging related to natural gas inventory
|
(0.26
|
)
|
0.45
|
|
(0.43
|
)
|
|||
Tax effect
|
0.08
|
|
(0.17
|
)
|
0.16
|
|
|||
Basic NFE per share
|
$
|
2.74
|
|
$
|
1.73
|
|
$
|
1.61
|
|
|
2018
|
|
2017
|
|
2016
|
||||||||||||
($ in thousands)
|
Operating Revenue
|
Bcf
|
|
Operating Revenue
|
Bcf
|
|
Operating Revenue
|
Bcf
|
|||||||||
Residential
|
$
|
441,486
|
|
45.5
|
|
|
$
|
395,315
|
|
40.7
|
|
|
$
|
345,597
|
|
36.9
|
|
Commercial and other
|
95,351
|
|
8.9
|
|
|
98,777
|
|
8.7
|
|
|
80,994
|
|
7.3
|
|
|||
Firm transportation
|
65,256
|
|
15.5
|
|
|
73,206
|
|
14.4
|
|
|
69,696
|
|
14.1
|
|
|||
Total residential and commercial
|
602,093
|
|
69.9
|
|
|
567,298
|
|
63.8
|
|
|
496,287
|
|
58.3
|
|
|||
Interruptible
|
7,522
|
|
46.2
|
|
|
7,970
|
|
55.0
|
|
|
8,867
|
|
61.5
|
|
|||
Total system
|
609,615
|
|
116.1
|
|
|
575,268
|
|
118.8
|
|
|
505,154
|
|
119.8
|
|
|||
BGSS incentive programs
(1)
|
122,250
|
|
42.8
|
|
|
120,369
|
|
49.5
|
|
|
89,192
|
|
56.6
|
|
|||
Total
|
$
|
731,865
|
|
158.9
|
|
|
$
|
695,637
|
|
168.3
|
|
|
$
|
594,346
|
|
176.4
|
|
(1)
|
Does not include
107.4
,
128.9
and
160.1
Bcf for the capacity release program and related amounts of
$5.7 million
,
$6.5 million
and
$8.1 million
, which are recorded as a reduction of gas purchases on the Consolidated Statements of Operations for the fiscal years ended
September 30, 2018
,
2017
and
2016
, respectively.
|
(1)
|
Numbers are shown net of any capacity release contracted amounts.
|
Pipeline
|
Dths
|
Expiration
|
||
Texas Eastern Transmission, L.P.
|
94,557
|
|
|
2020
|
Transcontinental Gas Pipe Line Corp.
|
8,384
|
|
|
2028
|
Total
|
102,941
|
|
|
|
Company
|
Dths
|
Expiration
|
||
Dominion Transmission Corporation
|
208,214
|
|
|
Various dates between 2021 and 2024
|
Steckman Ridge, L.P.
|
38,000
|
|
|
2020
|
Stagecoach Pipeline & Storage Company LLC
|
25,337
|
|
|
2023
|
Total
|
271,551
|
|
|
|
•
|
Providing natural gas portfolio management services to nonaffiliated and our affiliated natural gas utility, 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 our
50 percent
equity investment in Steckman Ridge. Steckman Ridge is a Delaware limited partnership, jointly owned and controlled by our subsidiaries 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 includes our
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. Adelphia, our wholly owned subsidiary of NJR Pipeline Company, was established in anticipation of acquiring the membership interests in IEC. Upon closing, Adelphia will include an existing 84-mile pipeline in southeastern Pennsylvania and related assets and rights of way; 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
110,000
service contract customers, as well as installation of solar equipment;
|
•
|
NJR Plumbing Services, Inc.
, which provides plumbing repair and installation services;
|
•
|
CR&R, which holds commercial real estate;
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
|
61
|
1986
|
Chairman of the Board (September 1996 - present)
Chief Executive Officer (July 1995 - present) President (July 1995 - September 2018) |
Patrick J. Migliaccio
|
44
|
2013
|
Senior Vice President and Chief Financial Officer (January 2016 - present)
Vice President, Finance and Accounting (November 2014 - December 2015) Treasurer (August 2013 - May 2015) |
Stephen D. Westhoven
|
50
|
2004
|
President and Chief Operating Officer (October 2018 - present)
Executive Vice President and Chief Operating Officer (November 2017 - September 2018) Senior Vice President and Chief Operating Officer, NJRES and NJRCEV (October 2016 - October 2017) Senior Vice President, NJRES (May 2010 - September 2016) |
Glenn C. Lockwood
|
57
|
1990
|
Executive Vice President (January 2011 - present)
Chief Financial Officer (September 1995 - December 2015) |
Amanda E. Mullan
|
52
|
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
|
54
|
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
|
54
|
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) |
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
|
||||
7/01/18 - 7/31/18
|
—
|
$
|
—
|
|
—
|
|
|
2,431,053
|
8/01/18 - 8/31/18
|
—
|
$
|
—
|
|
—
|
|
|
2,431,053
|
9/01/18 - 9/30/18
|
—
|
$
|
—
|
|
—
|
|
|
2,431,053
|
Total
|
—
|
$
|
—
|
|
—
|
|
|
2,431,053
|
(Thousands, except per share data)
|
|
|
|
|
|
||||||||||
Fiscal Years Ended September 30,
|
2018
|
2017
|
2016
|
2015
|
2014
|
||||||||||
SELECTED FINANCIAL DATA
|
|
|
|
|
|
||||||||||
Operating revenues
|
$
|
2,915,109
|
|
$
|
2,268,617
|
|
$
|
1,880,905
|
|
$
|
2,733,987
|
|
$
|
3,738,145
|
|
Gas purchases
|
$
|
2,275,342
|
|
$
|
1,703,767
|
|
$
|
1,352,686
|
|
$
|
2,085,645
|
|
$
|
3,139,525
|
|
Net income
|
$
|
233,436
|
|
$
|
132,065
|
|
$
|
131,672
|
|
$
|
180,960
|
|
$
|
141,970
|
|
Total assets
|
$
|
4,143,664
|
|
$
|
3,928,507
|
|
$
|
3,718,570
|
|
$
|
3,284,357
|
|
$
|
3,125,388
|
|
Common stock equity
|
$
|
1,418,978
|
|
$
|
1,236,643
|
|
$
|
1,166,591
|
|
$
|
1,106,956
|
|
$
|
966,166
|
|
Long-term debt
(1) (2)
|
$
|
1,180,619
|
|
$
|
997,080
|
|
$
|
1,055,038
|
|
$
|
843,595
|
|
$
|
598,209
|
|
|
|
|
|
|
|
||||||||||
COMMON STOCK DATA
|
|
|
|
|
|
||||||||||
Earnings per share-basic
|
$2.66
|
$1.53
|
$1.53
|
$2.12
|
$1.69
|
||||||||||
Earnings per share-diluted
|
$2.64
|
$1.52
|
$1.52
|
$2.10
|
$1.67
|
||||||||||
Dividends declared per share
|
$1.11
|
$1.038
|
$0.975
|
$0.915
|
$0.855
|
||||||||||
|
|
|
|
|
|
||||||||||
NON-GAAP RECONCILIATION
|
|
|
|
|
|
||||||||||
Net income
|
$
|
233,436
|
|
$
|
132,065
|
|
$
|
131,672
|
|
$
|
180,960
|
|
$
|
141,970
|
|
Add:
|
|
|
|
|
|
||||||||||
Unrealized loss (gain) on derivative instruments and related transactions
|
26,770
|
|
(11,241
|
)
|
46,883
|
|
(38,681
|
)
|
28,534
|
|
|||||
Tax effect
|
(4,512
|
)
|
4,062
|
|
(17,018
|
)
|
14,391
|
|
(10,492
|
)
|
|||||
Effects of economic hedging related to natural gas inventory
|
(22,570
|
)
|
38,470
|
|
(36,816
|
)
|
(8,225
|
)
|
26,639
|
|
|||||
Tax effect
|
7,362
|
|
(13,964
|
)
|
13,364
|
|
3,058
|
|
(9,794
|
)
|
|||||
Net financial earnings
(3)
|
$
|
240,486
|
|
$
|
149,392
|
|
$
|
138,085
|
|
$
|
151,503
|
|
$
|
176,857
|
|
|
|
|
|
|
|
||||||||||
Basic earnings per share
|
$2.66
|
$1.53
|
$1.53
|
$2.12
|
$1.69
|
||||||||||
Add:
|
|
|
|
|
|
||||||||||
Unrealized loss (gain) on derivative instruments and related transactions
|
0.31
|
|
(0.13
|
)
|
0.55
|
|
(0.45
|
)
|
0.34
|
|
|||||
Tax effect
|
(0.05
|
)
|
0.05
|
|
(0.20
|
)
|
0.17
|
|
(0.13
|
)
|
|||||
Effects of economic hedging related to natural gas inventory
|
(0.26
|
)
|
0.45
|
|
(0.43
|
)
|
(0.10
|
)
|
0.32
|
|
|||||
Tax effect
|
0.08
|
|
(0.17
|
)
|
0.16
|
|
0.04
|
|
(0.12
|
)
|
|||||
Net financial earnings per share-basic
(3)
|
$2.74
|
$1.73
|
$1.61
|
$1.78
|
$2.10
|
||||||||||
|
|
|
|
|
|
||||||||||
Diluted earnings per share
|
$2.64
|
$1.52
|
$1.52
|
$2.10
|
$1.67
|
||||||||||
Add:
|
|
|
|
|
|
||||||||||
Unrealized loss (gain) on derivative instruments and related transactions
|
0.30
|
|
(0.13
|
)
|
0.54
|
|
(0.45
|
)
|
0.34
|
|
|||||
Tax effect
|
(0.05
|
)
|
0.05
|
|
(0.20
|
)
|
0.17
|
|
(0.12
|
)
|
|||||
Effects of economic hedging related to natural gas inventory
|
(0.25
|
)
|
0.44
|
|
(0.42
|
)
|
(0.10
|
)
|
0.31
|
|
|||||
Tax effect
|
0.08
|
|
(0.17
|
)
|
0.15
|
|
0.04
|
|
(0.12
|
)
|
|||||
Net financial earnings per share-diluted
(3)
|
$2.72
|
$1.71
|
$1.59
|
$1.76
|
$2.08
|
(1)
|
Includes long-term capital leases of
$26.4 million
,
$28.9 million
,
$30.7 million
,
$35.7 million
and
$40.4 million
, respectively.
|
(2)
|
Includes long-term solar asset financing obligation of
$89.8 million
and
$28.2 million
in
fiscal 2018
and
2017
, respectively.
|
(3)
|
NFE is a non-GAAP financial measure that eliminates the timing differences surrounding the recognition of certain derivative gains or losses, to effectively match the earnings effects of economic hedges associated with the physical sale or purchase of gas and, therefore, eliminate the impact of volatility to GAAP earnings associated with the related derivative instruments. For further discussion of this financial measure, see the Energy Services segment in
Item 7. Management
’
s Discussion and Analysis of Financial Condition and Results of Operations
.
|
Fiscal Years Ended September 30,
|
2018
|
2017
|
2016
|
2015
|
2014
|
||||||||||
Operating revenues
($ in thousands)
|
|
|
|
|
|
||||||||||
Residential
|
$
|
441,486
|
|
$
|
395,315
|
|
$
|
345,597
|
|
$
|
466,464
|
|
$
|
469,831
|
|
Commercial, industrial and other
|
95,351
|
|
98,777
|
|
80,994
|
|
106,505
|
|
110,740
|
|
|||||
Firm transportation
|
65,256
|
|
73,206
|
|
69,696
|
|
77,974
|
|
86,131
|
|
|||||
Total residential and commercial
|
602,093
|
|
567,298
|
|
496,287
|
|
650,943
|
|
666,702
|
|
|||||
Interruptible
|
7,522
|
|
7,970
|
|
8,867
|
|
10,049
|
|
9,384
|
|
|||||
Total system
|
609,615
|
|
575,268
|
|
505,154
|
|
660,992
|
|
676,086
|
|
|||||
BGSS incentive programs
|
122,250
|
|
120,369
|
|
89,192
|
|
120,978
|
|
143,329
|
|
|||||
Total operating revenues
|
$
|
731,865
|
|
$
|
695,637
|
|
$
|
594,346
|
|
$
|
781,970
|
|
$
|
819,415
|
|
Throughput (Bcf)
|
|
|
|
|
|
||||||||||
Residential
|
45.5
|
|
40.7
|
|
36.9
|
|
45.9
|
|
43.1
|
|
|||||
Commercial, industrial and other
|
8.9
|
|
8.7
|
|
7.3
|
|
9.6
|
|
8.2
|
|
|||||
Firm transportation
|
15.5
|
|
14.4
|
|
14.1
|
|
16.0
|
|
17.7
|
|
|||||
Total residential and commercial
|
69.9
|
|
63.8
|
|
58.3
|
|
71.5
|
|
69.0
|
|
|||||
Interruptible
|
46.2
|
|
55
|
|
61.5
|
|
47.1
|
|
10.5
|
|
|||||
Total system
|
116.1
|
|
118.8
|
|
119.8
|
|
118.6
|
|
79.5
|
|
|||||
BGSS incentive programs
|
150.2
|
|
178.4
|
|
216.7
|
|
222.4
|
|
180.8
|
|
|||||
Total throughput
|
266.3
|
|
297.2
|
|
336.5
|
|
341.0
|
|
260.3
|
|
|||||
Customers at year-end
|
|
|
|
|
|
||||||||||
Residential
|
474,495
|
|
460,013
|
|
448,273
|
|
437,979
|
|
422,742
|
|
|||||
Commercial, industrial and other
|
28,037
|
|
26,947
|
|
26,218
|
|
25,541
|
|
24,684
|
|
|||||
Firm transportation
|
36,126
|
|
42,790
|
|
46,608
|
|
48,673
|
|
56,777
|
|
|||||
Total residential and commercial
|
538,658
|
|
529,750
|
|
521,099
|
|
512,193
|
|
504,203
|
|
|||||
Interruptible
|
31
|
|
33
|
|
34
|
|
35
|
|
37
|
|
|||||
BGSS incentive programs
|
28
|
|
27
|
|
30
|
|
24
|
|
34
|
|
|||||
Total customers at year-end
|
538,717
|
|
529,810
|
|
521,163
|
|
512,252
|
|
504,274
|
|
|||||
Interest coverage ratio
(1)
|
6.35
|
|
7.96
|
|
8.97
|
|
9.57
|
|
10.24
|
|
|||||
Average therm use per customer
|
|
|
|
|
|
||||||||||
Residential
|
959
|
|
885
|
|
824
|
|
1,049
|
|
1,020
|
|
|||||
Commercial, industrial and other
|
10,992
|
|
11,183
|
|
11,378
|
|
9,799
|
|
4,466
|
|
|||||
Degree days
|
4,537
|
|
4,129
|
|
3,867
|
|
5,015
|
|
5,080
|
|
|||||
Weather as a percent of normal
(2)
|
99.5
|
%
|
90.0
|
%
|
82.5
|
%
|
108.3
|
%
|
109.6
|
%
|
|||||
Number of employees
|
686
|
|
680
|
|
670
|
|
649
|
|
626
|
|
(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
|
|
%
|
|
$
|
(37,153
|
)
|
|
|
$
|
(4,095
|
)
|
|
Discount rate
|
(1.00
|
)
|
%
|
|
$
|
46,432
|
|
|
|
$
|
4,756
|
|
|
Rate of return on plan assets
|
1.00
|
|
%
|
|
n/a
|
|
|
$
|
(2,619
|
)
|
|
||
Rate of return on plan assets
|
(1.00
|
)
|
%
|
|
n/a
|
|
|
$
|
2,619
|
|
|
Other Postemployment Benefits
|
|
|
|
|
|
|
|
|
|||||
Actuarial Assumptions
|
Increase/
(Decrease)
|
Estimated
Increase/(Decrease) on PBO (Thousands) |
Estimated
Increase/(Decrease) to Expense (Thousands) |
||||||||||
Discount rate
|
1.00
|
|
%
|
|
$
|
(28,595
|
)
|
|
|
$
|
(2,728
|
)
|
|
Discount rate
|
(1.00
|
)
|
%
|
|
$
|
36,736
|
|
|
|
$
|
3,406
|
|
|
Rate of return on plan assets
|
1.00
|
|
%
|
|
n/a
|
|
|
$
|
(713
|
)
|
|
||
Rate of return on plan assets
|
(1.00
|
)
|
%
|
|
n/a
|
|
|
$
|
714
|
|
|
||
|
|
|
|
|
|
|
|
|
|||||
Actuarial Assumptions
|
Increase/
(Decrease)
|
Estimated
Increase/(Decrease) on PBO (Thousands) |
Estimated
Increase/(Decrease) to Expense (Thousands) |
||||||||||
Health care cost trend rate
|
1.00
|
|
%
|
|
$
|
36,260
|
|
|
|
$
|
3,838
|
|
|
Health care cost trend rate
|
(1.00
|
)
|
%
|
|
$
|
(28,743
|
)
|
|
|
$
|
(2,991
|
)
|
|
(Thousands)
|
2018
|
2017
|
2016
|
|||||||||||||||
|
Net Income
|
Assets
|
Net Income
|
Assets
|
Net Income
|
Assets
|
||||||||||||
Natural Gas Distribution
|
$
|
84,048
|
|
$
|
2,663,054
|
|
$
|
86,930
|
|
$
|
2,519,578
|
|
$
|
76,104
|
|
$
|
2,517,401
|
|
Clean Energy Ventures
|
75,849
|
|
865,018
|
|
24,873
|
|
771,340
|
|
28,393
|
|
665,696
|
|
||||||
Energy Services
|
53,139
|
|
396,852
|
|
476
|
|
398,277
|
|
14,265
|
|
327,626
|
|
||||||
Midstream
|
24,367
|
|
242,069
|
|
12,857
|
|
232,806
|
|
9,406
|
|
186,259
|
|
||||||
Home Services and Other
|
(3,555
|
)
|
114,732
|
|
6,811
|
|
114,801
|
|
2,882
|
|
109,487
|
|
||||||
Intercompany
(1)
|
(412
|
)
|
(138,061
|
)
|
118
|
|
(108,295
|
)
|
622
|
|
(87,899
|
)
|
||||||
Total
|
$
|
233,436
|
|
$
|
4,143,664
|
|
$
|
132,065
|
|
$
|
3,928,507
|
|
$
|
131,672
|
|
$
|
3,718,570
|
|
(1)
|
Consists of transactions between subsidiaries that are eliminated in consolidation.
|
(Thousands, except per share data)
|
2018
|
2017
|
2016
|
||||||
Net income
|
$
|
233,436
|
|
$
|
132,065
|
|
$
|
131,672
|
|
Add:
|
|
|
|
||||||
Unrealized loss (gain) on derivative instruments and related transactions
|
26,770
|
|
(11,241
|
)
|
46,883
|
|
|||
Tax effect
|
(4,512
|
)
|
4,062
|
|
(17,018
|
)
|
|||
Effects of economic hedging related to natural gas inventory
(1)
|
(22,570
|
)
|
38,470
|
|
(36,816
|
)
|
|||
Tax effect
|
7,362
|
|
(13,964
|
)
|
13,364
|
|
|||
Net financial earnings
|
$
|
240,486
|
|
$
|
149,392
|
|
$
|
138,085
|
|
|
|
|
|
||||||
Basic earnings per share
|
$
|
2.66
|
|
$
|
1.53
|
|
$
|
1.53
|
|
Add:
|
|
|
|
||||||
Unrealized loss (gain) on derivative instruments and related transactions
|
0.31
|
|
(0.13
|
)
|
0.55
|
|
|||
Tax effect
|
(0.05
|
)
|
0.05
|
|
(0.20
|
)
|
|||
Effects of economic hedging related to natural gas inventory
(1)
|
(0.26
|
)
|
0.45
|
|
(0.43
|
)
|
|||
Tax effect
|
0.08
|
|
(0.17
|
)
|
0.16
|
|
|||
Basic net financial earnings per share
|
$
|
2.74
|
|
$
|
1.73
|
|
$
|
1.61
|
|
(1)
|
Effects of hedging natural gas inventory transactions where the economic impact is realized in a future period.
|
(Thousands)
|
2018
|
|
2017
|
|
2016
|
||||||||||||
Natural Gas Distribution
|
$
|
84,048
|
|
35
|
%
|
|
$
|
86,930
|
|
58
|
%
|
|
$
|
76,104
|
|
55
|
%
|
Clean Energy Ventures
|
75,849
|
|
32
|
|
|
24,873
|
|
17
|
|
|
28,393
|
|
20
|
|
|||
Energy Services
|
60,378
|
|
25
|
|
|
18,554
|
|
12
|
|
|
21,934
|
|
16
|
|
|||
Midstream
|
24,367
|
|
10
|
|
|
12,857
|
|
9
|
|
|
9,406
|
|
7
|
|
|||
Home Services and Other
|
(3,829
|
)
|
(2
|
)
|
|
6,811
|
|
4
|
|
|
2,882
|
|
2
|
|
|||
Eliminations
(1)
|
(327
|
)
|
—
|
|
|
(633
|
)
|
—
|
|
|
(634
|
)
|
—
|
|
|||
Total
|
$
|
240,486
|
|
100
|
%
|
|
$
|
149,392
|
|
100
|
%
|
|
$
|
138,085
|
|
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
1.8 percent
annually through fiscal
2021
;
|
•
|
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.
|
|
2018
|
2017
|
2016
|
|||
Firm customers
|
|
|
|
|||
Residential
|
474,495
|
|
460,013
|
|
448,273
|
|
Commercial, industrial & other
|
28,037
|
|
26,947
|
|
26,218
|
|
Residential transport
|
26,490
|
|
32,653
|
|
36,292
|
|
Commercial transport
|
9,636
|
|
10,137
|
|
10,316
|
|
Total firm customers
|
538,658
|
|
529,750
|
|
521,099
|
|
Other
|
59
|
|
60
|
|
64
|
|
Total customers
|
538,717
|
|
529,810
|
|
521,163
|
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Weather
(1)
|
$
|
205
|
|
$
|
19,261
|
|
$
|
27,547
|
|
Usage
|
(1,629
|
)
|
(2,309
|
)
|
10,420
|
|
|||
Total
|
$
|
(1,424
|
)
|
$
|
16,952
|
|
$
|
37,967
|
|
(1)
|
Compared with the CIP 20-year average, weather was
0.5 percent
,
10 percent
and
17.5 percent
warmer
-than-normal during
fiscal 2018
,
2017
and
2016
, respectively.
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Operating revenues
|
$
|
731,865
|
|
$
|
695,637
|
|
$
|
594,346
|
|
Operating expenses
|
|
|
|
||||||
Gas purchases
(1) (2)
|
333,208
|
|
269,480
|
|
215,849
|
|
|||
Operation and maintenance
|
161,723
|
|
142,509
|
|
130,575
|
|
|||
Regulatory rider expense
(3)
|
38,969
|
|
40,243
|
|
39,300
|
|
|||
Depreciation and amortization
|
53,208
|
|
49,347
|
|
47,828
|
|
|||
Energy and other taxes
(4)
|
44,184
|
|
42,417
|
|
34,561
|
|
|||
Total operating expenses
|
631,292
|
|
543,996
|
|
468,113
|
|
|||
Operating income
|
100,573
|
|
151,641
|
|
126,233
|
|
|||
Other income, net
|
6,864
|
|
4,592
|
|
4,752
|
|
|||
Interest expense, net of capitalized interest
|
25,299
|
|
25,818
|
|
19,930
|
|
|||
Income tax (benefit) provision
|
(1,910
|
)
|
43,485
|
|
34,951
|
|
|||
Net income
|
$
|
84,048
|
|
$
|
86,930
|
|
$
|
76,104
|
|
(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
$57.2 million
,
$10.8 million
and
$10.8 million
during
fiscal 2018
,
2017
and
2016
, 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.
|
|
2018 v. 2017
|
|
2017 v. 2016
|
||||||||||
(Thousands)
|
Operating
revenue
|
Gas
purchases
|
|
Operating
revenue
|
Gas
purchases
|
||||||||
Firm sales
|
$
|
49,414
|
|
$
|
19,779
|
|
|
$
|
44,397
|
|
$
|
21,634
|
|
Bill credits
(1)
|
41,971
|
|
39,260
|
|
|
19,588
|
|
18,265
|
|
||||
Average BGSS rates
(2)
|
1,147
|
|
1,413
|
|
|
(17,874
|
)
|
(16,544
|
)
|
||||
Off-system sales
|
677
|
|
221
|
|
|
29,156
|
|
29,117
|
|
||||
Tax Act impact
|
(35,910
|
)
|
—
|
|
|
—
|
|
—
|
|
||||
CIP adjustments
|
(18,375
|
)
|
—
|
|
|
(21,015
|
)
|
—
|
|
||||
Rate impact
(3)
|
—
|
|
—
|
|
|
37,436
|
|
—
|
|
||||
Other
(4)
|
(2,696
|
)
|
3,055
|
|
|
9,603
|
|
1,159
|
|
||||
Total increase
|
$
|
36,228
|
|
$
|
63,728
|
|
|
$
|
101,291
|
|
$
|
53,631
|
|
(1)
|
Operating revenues include changes in sales tax of
$2.7 million
and
$1.3 million
during
fiscal 2018
and
2017
, respectively
.
|
(2)
|
Operating revenues include changes in sales tax of
$266,000
and
$1.4 million
during
fiscal 2018
and
2017
, respectively.
|
(3)
|
Includes rate adjustments for the base rate case, CIP and demand charges.
|
(4)
|
Other includes changes for NJ RISE/SAFE II and rider rates, including those related to EE, NJCEP and other programs.
|
•
|
increased firm sales due primarily to customer growth and higher usage related to weather being
9.9 percent
colder
than fiscal 2017;
|
•
|
bill credits issued to residential and small commercial customers during fiscal 2017 that did not occur in fiscal 2018; partially offset by
|
•
|
the Tax Act impact, which is comprised of customer credits related to the initial revaluation of excess deferred income taxes and the overcollection of taxes from customers during the second quarter of fiscal 2018, including related interest and sales tax, as well as the effects from the reduction in base rates related to the Tax Act implemented during the third quarter;
|
•
|
a
decrease
in CIP due primarily to normal weather during fiscal 2018, compared with warmer-than-normal weather during fiscal 2017; and
|
•
|
higher
off-system sales due primarily to an
increase
of
19.7 percent
in the average price of natural gas sold, partially offset by a
reduction
in volumes of
15.9 percent
.
|
•
|
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 natural 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 in the prior 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.
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Operating revenues
|
$
|
731,865
|
|
$
|
695,637
|
|
$
|
594,346
|
|
Less:
|
|
|
|
||||||
Gas purchases
|
333,208
|
|
269,480
|
|
215,849
|
|
|||
Energy taxes
|
39,426
|
|
37,917
|
|
29,832
|
|
|||
Regulatory rider expense
|
38,969
|
|
40,243
|
|
39,300
|
|
|||
Utility gross margin
|
$
|
320,262
|
|
$
|
347,997
|
|
$
|
309,365
|
|
•
|
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.
|
|
2018
|
|
2017
|
|
2016
|
||||||||||||
($ in thousands)
|
Margin
|
Bcf
|
|
Margin
|
Bcf
|
|
Margin
|
Bcf
|
|||||||||
Utility gross margin/throughput
|
|
|
|
|
|
|
|
|
|||||||||
Residential
|
$
|
203,195
|
|
45.5
|
|
|
$
|
218,093
|
|
40.7
|
|
|
$
|
187,762
|
|
36.9
|
|
Commercial, industrial and other
|
46,636
|
|
8.9
|
|
|
51,510
|
|
8.7
|
|
|
46,878
|
|
7.3
|
|
|||
Firm transportation
|
51,880
|
|
15.5
|
|
|
58,172
|
|
14.4
|
|
|
54,841
|
|
14.1
|
|
|||
Total utility firm gross margin/throughput
|
301,711
|
|
69.9
|
|
|
327,775
|
|
63.8
|
|
|
289,481
|
|
58.3
|
|
|||
BGSS incentive programs
|
12,482
|
|
150.2
|
|
|
13,724
|
|
178.4
|
|
|
14,978
|
|
216.7
|
|
|||
Interruptible/off-tariff agreements
|
6,069
|
|
46.2
|
|
|
6,498
|
|
55
|
|
|
4,906
|
|
61.5
|
|
|||
Total utility gross margin/throughput
|
$
|
320,262
|
|
266.3
|
|
|
$
|
347,997
|
|
297.2
|
|
|
$
|
309,365
|
|
336.5
|
|
(Thousands)
|
2018 v. 2017
|
2017 v. 2016
|
||||||||
Tax Act impact
|
|
$
|
(33,657
|
)
|
|
|
$
|
—
|
|
|
SAVEGREEN
|
|
(977
|
)
|
|
|
(345
|
)
|
|
||
NJ RISE/SAFE II
|
|
4,334
|
|
|
|
—
|
|
|
||
Customer growth
|
|
4,236
|
|
|
|
3,619
|
|
|
||
Rate impact
|
|
—
|
|
|
|
35,019
|
|
|
||
Total (decrease) increase
|
|
$
|
(26,064
|
)
|
|
|
$
|
38,293
|
|
|
(Thousands)
|
2018 v. 2017
|
2017 v. 2016
|
||||||||
Storage
|
|
$
|
(954
|
)
|
|
|
$
|
378
|
|
|
Capacity release
|
|
(745
|
)
|
|
|
(1,672
|
)
|
|
||
Off-system sales
|
|
457
|
|
|
|
39
|
|
|
||
Total decrease
|
|
$
|
(1,242
|
)
|
|
|
$
|
(1,255
|
)
|
|
(Thousands)
|
2018 v. 2017
|
2017 v. 2016
|
||||||||
Shared corporate costs
|
|
$
|
5,991
|
|
|
|
$
|
3,061
|
|
|
Compensation and benefits
|
|
5,767
|
|
|
|
5,412
|
|
|
||
Consulting
|
|
5,184
|
|
|
|
512
|
|
|
||
Other
|
|
2,272
|
|
|
|
2,949
|
|
|
||
Total increase
|
|
$
|
19,214
|
|
|
|
$
|
11,934
|
|
|
•
|
increased shared corporate costs due primarily to increased headcount and incentives, along with additional expenses related to a voluntary early retirement program;
|
•
|
increased compensation and benefits as a result of voluntary early retirement program costs; and
|
•
|
increased consulting expenses due primarily to technology improvements.
|
•
|
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 in other 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.
|
($ in Thousands)
|
2018
|
2017
|
2016
|
||||||||||||||||||
Placed in service
|
Projects
|
MW
|
Costs
|
Projects
|
MW
|
Costs
|
Projects
|
MW
|
Costs
|
||||||||||||
Grid-connected
(1)
|
3
|
|
33.7
|
|
$
|
70,216
|
|
2
|
|
20.0
|
|
$
|
62,700
|
|
5
|
|
21.8
|
|
$
|
51,240
|
|
Net-metered:
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial
(1)
|
—
|
|
—
|
|
74
|
|
3
|
|
7.1
|
|
19,714
|
|
—
|
|
—
|
|
3
|
|
|||
Residential
|
910
|
|
8.5
|
|
27,342
|
|
1,300
|
|
12.4
|
|
37,901
|
|
1,123
|
|
10.4
|
|
34,318
|
|
|||
Total placed in service
|
913
|
|
42.2
|
|
$
|
97,632
|
|
1,305
|
|
39.5
|
|
$
|
120,315
|
|
1,128
|
|
32.2
|
|
$
|
85,561
|
|
(1)
|
Includes projects subject to sale-leaseback arrangements.
|
|
2018
|
2017
|
2016
|
|||
Inventory balance as of October 1,
|
48,357
|
|
24,135
|
|
33,203
|
|
SRECs generated
|
245,147
|
|
197,521
|
|
160,009
|
|
SRECs delivered
|
(188,312
|
)
|
(173,299
|
)
|
(169,077
|
)
|
Inventory balance as of September 30,
|
105,192
|
|
48,357
|
|
24,135
|
|
(1)
|
Energy years are compliance periods for New Jersey’s renewable portfolio standard that run from June 1 to May 31.
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Operating revenues
|
$
|
71,375
|
|
$
|
64,394
|
|
$
|
53,540
|
|
Operating expenses
|
|
|
|
||||||
Operation and maintenance
|
26,298
|
|
23,448
|
|
18,897
|
|
|||
Depreciation and amortization
|
31,877
|
|
31,834
|
|
23,971
|
|
|||
Other taxes
|
1,137
|
|
1,209
|
|
900
|
|
|||
Total operating expenses
|
59,312
|
|
56,491
|
|
43,768
|
|
|||
Operating income
|
12,063
|
|
7,903
|
|
9,772
|
|
|||
Other income, net
|
2,174
|
|
2,072
|
|
2,333
|
|
|||
Interest expense, net
|
18,320
|
|
16,263
|
|
10,304
|
|
|||
Income tax benefit
|
(79,932
|
)
|
(31,161
|
)
|
(26,592
|
)
|
|||
Net income
|
$
|
75,849
|
|
$
|
24,873
|
|
$
|
28,393
|
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Operating revenues
(1)
|
$
|
2,112,804
|
|
$
|
1,462,681
|
|
$
|
1,197,253
|
|
Operating expenses
|
|
|
|
||||||
Gas purchases (including demand charges
(2)(3)
)
|
1,995,335
|
|
1,441,310
|
|
1,153,911
|
|
|||
Operation and maintenance
|
32,821
|
|
20,313
|
|
20,025
|
|
|||
Depreciation and amortization
|
76
|
|
63
|
|
88
|
|
|||
Other taxes
|
2,732
|
|
1,788
|
|
937
|
|
|||
Total operating expenses
|
2,030,964
|
|
1,463,474
|
|
1,174,961
|
|
|||
Operating income (loss)
|
81,840
|
|
(793
|
)
|
22,292
|
|
|||
Other income
|
240
|
|
1
|
|
98
|
|
|||
Interest expense, net
|
3,945
|
|
2,747
|
|
1,095
|
|
|||
Income tax provision (benefit)
|
24,996
|
|
(4,015
|
)
|
7,030
|
|
|||
Net income
|
$
|
53,139
|
|
$
|
476
|
|
$
|
14,265
|
|
(1)
|
Includes related party transactions of approximately
$48.3 million
,
$316,000
and
$9.5 million
during
fiscal 2018
,
2017
and
2016
, 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
$4.5 million
,
$4.6 million
and
$14.6 million
during
fiscal 2018
,
2017
and
2016
, respectively, a portion of which are eliminated in consolidation.
|
(in Bcf)
|
2018
|
|
2017
|
|
2016
|
|
Net short futures contracts
|
24.3
|
|
16.4
|
|
79.1
|
|
Net long options
|
—
|
|
—
|
|
1.2
|
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Operating revenues
|
$
|
2,112,804
|
|
$
|
1,462,681
|
|
$
|
1,197,253
|
|
Less: Gas purchases
|
1,995,335
|
|
1,441,310
|
|
1,153,911
|
|
|||
Add:
|
|
|
|
||||||
Unrealized (gain) loss on derivative instruments and related transactions
(1)
|
26,728
|
|
(10,063
|
)
|
48,855
|
|
|||
Effects of economic hedging related to natural gas inventory
(2)
|
(22,570
|
)
|
38,470
|
|
(36,816
|
)
|
|||
Financial margin
|
$
|
121,627
|
|
$
|
49,778
|
|
$
|
55,381
|
|
(1)
|
Includes unrealized (gains) losses related to an intercompany transaction between NJNG and Energy Services that have been eliminated in consolidation of approximately
$85,000
,
$(751,000)
and
$(1.3) million
for the fiscal years ended
September 30, 2018
,
2017
and
2016
, respectively.
|
(2)
|
Effects of hedging natural gas inventory transactions where the economic impact is realized in a future period.
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Operating income (loss)
|
$
|
81,840
|
|
$
|
(793
|
)
|
$
|
22,292
|
|
Add:
|
|
|
|
||||||
Operation and maintenance
|
32,821
|
|
20,313
|
|
20,025
|
|
|||
Depreciation and amortization
|
76
|
|
63
|
|
88
|
|
|||
Other taxes
|
2,732
|
|
1,788
|
|
937
|
|
|||
Subtotal
|
117,469
|
|
21,371
|
|
43,342
|
|
|||
Add:
|
|
|
|
||||||
Unrealized loss (gain) on derivative instruments and related transactions
|
26,728
|
|
(10,063
|
)
|
48,855
|
|
|||
Effects of economic hedging related to natural gas inventory
|
(22,570
|
)
|
38,470
|
|
(36,816
|
)
|
|||
Financial margin
|
$
|
121,627
|
|
$
|
49,778
|
|
$
|
55,381
|
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Net income
|
$
|
53,139
|
|
$
|
476
|
|
$
|
14,265
|
|
Add:
|
|
|
|
||||||
Unrealized loss (gain) on derivative instruments and related transactions
|
26,728
|
|
(10,063
|
)
|
48,855
|
|
|||
Tax effect
(1)
|
(4,281
|
)
|
3,635
|
|
(17,734
|
)
|
|||
Effects of economic hedging related to natural gas inventory
|
(22,570
|
)
|
38,470
|
|
(36,816
|
)
|
|||
Tax effect
|
7,362
|
|
(13,964
|
)
|
13,364
|
|
|||
Net financial earnings
|
$
|
60,378
|
|
$
|
18,554
|
|
$
|
21,934
|
|
(1)
|
Includes taxes related to an intercompany transaction between NJNG and Energy Services that have been eliminated in consolidation of approximately
$(337,000)
,
$427,000
and
$716,000
for the fiscal years ended
September 30, 2018
,
2017
and
2016
, respectively.
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Equity in earnings of affiliates
|
$
|
16,165
|
|
$
|
17,797
|
|
$
|
13,936
|
|
Operation and maintenance
|
$
|
4,441
|
|
$
|
2,302
|
|
$
|
1,197
|
|
Other income
|
$
|
5,775
|
|
$
|
4,162
|
|
$
|
3,130
|
|
Interest expense, net
|
$
|
1,667
|
|
$
|
960
|
|
$
|
287
|
|
Income tax provision
|
$
|
(8,548
|
)
|
$
|
5,820
|
|
$
|
6,130
|
|
Net income
|
$
|
24,367
|
|
$
|
12,857
|
|
$
|
9,406
|
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Steckman Ridge
|
$
|
11,283
|
|
$
|
13,351
|
|
$
|
14,050
|
|
PennEast
|
4,882
|
|
4,446
|
|
(114
|
)
|
|||
Total equity in earnings of affiliates
|
$
|
16,165
|
|
$
|
17,797
|
|
$
|
13,936
|
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Operating revenues
|
$
|
50,057
|
|
$
|
49,591
|
|
$
|
48,497
|
|
Operation and maintenance
|
$
|
43,731
|
|
$
|
40,245
|
|
$
|
40,106
|
|
Energy and other taxes
|
$
|
4,042
|
|
$
|
3,938
|
|
$
|
3,777
|
|
Other income, net
|
$
|
6,892
|
|
$
|
6,467
|
|
$
|
869
|
|
Income tax provision
|
$
|
11,944
|
|
$
|
3,857
|
|
$
|
1,387
|
|
Net (loss) income
|
$
|
(3,555
|
)
|
$
|
6,811
|
|
$
|
2,882
|
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Net income (loss)
|
$
|
(3,555
|
)
|
$
|
6,811
|
|
$
|
2,882
|
|
Add:
|
|
|
|
||||||
Unrealized (gain) loss on derivative instruments and related transactions
|
(381
|
)
|
—
|
|
—
|
|
|||
Tax effect
|
107
|
|
—
|
|
—
|
|
|||
Net financial earnings (loss)
|
$
|
(3,829
|
)
|
$
|
6,811
|
|
$
|
2,882
|
|
|
2018
|
|
2017
|
|
Common stock equity
|
49
|
%
|
46
|
%
|
Long-term debt
|
41
|
|
38
|
|
Short-term debt
|
10
|
|
16
|
|
Total
|
100
|
%
|
100
|
%
|
|
|
Up to
|
1-3
|
3-5
|
After
|
||||||||||
(Thousands)
|
Total
|
1 Year
|
Years
|
Years
|
5 Years
|
||||||||||
Long-term debt
(1)
|
$
|
1,783,345
|
|
$
|
139,772
|
|
$
|
74,338
|
|
$
|
172,472
|
|
$
|
1,396,763
|
|
Capital lease obligations
(1)
|
39,570
|
|
10,932
|
|
17,225
|
|
6,168
|
|
5,245
|
|
|||||
Solar asset financing obligations
(1)
|
79,410
|
|
9,794
|
|
15,633
|
|
15,680
|
|
38,303
|
|
|||||
Operating leases
(1)
|
67,740
|
|
3,217
|
|
7,445
|
|
7,028
|
|
50,050
|
|
|||||
Short-term debt
|
151,950
|
|
151,950
|
|
—
|
|
—
|
|
—
|
|
|||||
New Jersey Clean Energy Program
(1)
|
14,052
|
|
14,052
|
|
—
|
|
—
|
|
—
|
|
|||||
Construction obligations
|
23,903
|
|
23,903
|
|
—
|
|
—
|
|
—
|
|
|||||
Remediation expenditures
(2)
|
130,800
|
|
19,800
|
|
28,800
|
|
28,800
|
|
53,400
|
|
|||||
Natural gas supply purchase obligations-NJNG
|
240,731
|
|
65,737
|
|
71,465
|
|
67,767
|
|
35,762
|
|
|||||
Demand fee commitments-NJNG
|
1,128,331
|
|
111,993
|
|
223,991
|
|
200,015
|
|
592,332
|
|
|||||
Natural gas supply purchase obligations-Energy Services
|
467,369
|
|
428,015
|
|
39,354
|
|
—
|
|
—
|
|
|||||
Demand fee commitments-Energy Services
|
257,666
|
|
83,864
|
|
111,403
|
|
56,257
|
|
6,142
|
|
|||||
Total contractual cash obligations
|
$
|
4,384,867
|
|
$
|
1,063,029
|
|
$
|
589,654
|
|
$
|
554,187
|
|
$
|
2,177,997
|
|
(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 13. Commitments and Contingent Liabilities
in the accompanying Consolidated Financial Statements
.
|
|
S&P
|
Moody’s
|
Corporate Rating
|
BBB+
|
N/A
|
Commercial Paper
|
A-2
|
P-1
|
Senior Secured
|
A
|
Aa2
|
Ratings Outlook
|
Negative
|
Negative
|
|
Balance
|
Increase
|
Less
|
Balance
|
||||||||||||
(Thousands)
|
September 30,
2017 |
(Decrease) in Fair
Market Value
|
Amounts
Settled
|
September 30,
2018 |
||||||||||||
Natural Gas Distribution
|
|
$
|
(1,149
|
)
|
|
$
|
(25
|
)
|
|
$
|
(1,268
|
)
|
|
$
|
94
|
|
Energy Services
|
|
(5,552
|
)
|
|
(22,571
|
)
|
(1)
|
(14,198
|
)
|
|
(13,925
|
)
|
||||
Total
|
|
$
|
(6,701
|
)
|
|
$
|
(22,596
|
)
|
|
$
|
(15,466
|
)
|
|
$
|
(13,831
|
)
|
(Thousands)
|
2019
|
2020
|
2021 - 2023
|
After 2023
|
Total
Fair Value
|
|||||||||||||
Price based on NYMEX/CME
|
$
|
4,425
|
|
$
|
1,880
|
|
|
$
|
721
|
|
|
$
|
—
|
|
|
$
|
7,026
|
|
Price based on ICE
|
(13,371
|
)
|
(7,263
|
)
|
|
(223
|
)
|
|
—
|
|
|
(20,857
|
)
|
|||||
Total
|
$
|
(8,946
|
)
|
$
|
(5,383
|
)
|
|
$
|
498
|
|
|
$
|
—
|
|
|
$
|
(13,831
|
)
|
|
|
Volume Bcf
|
Price per MMBtu
(1)
|
Amounts included in Derivatives (Thousands)
|
||||
Natural Gas Distribution
|
Futures
|
27.9
|
|
2.28 - 3.05
|
|
$
|
94
|
|
Energy Services
|
Futures
|
(7.0
|
)
|
$1.48 - $5.93
|
|
(20,949
|
)
|
|
|
Swaps
|
(17.3
|
)
|
2.72 - 3.46
|
|
7,024
|
|
|
Total
|
|
|
|
|
$
|
(13,831
|
)
|
(1)
|
Million British thermal unit
|
|
Balance
|
Increase
|
Less
|
Balance
|
||||||||||
(Thousands)
|
September 30,
2017 |
(Decrease) in Fair
Market Value
|
Amounts
Settled
|
September 30,
2018 |
||||||||||
Natural Gas Distribution - Prices based on other external data
|
|
$
|
79
|
|
|
4,587
|
|
|
4,773
|
|
|
$
|
(107
|
)
|
Energy Services - Prices based on other external data
|
|
(3,584
|
)
|
|
277
|
|
|
14,570
|
|
|
(17,877
|
)
|
||
Total
|
|
$
|
(3,505
|
)
|
|
4,864
|
|
|
19,343
|
|
|
$
|
(17,984
|
)
|
|
Balance
|
Increase
|
Less
|
Balance
|
||||||||||
(Thousands)
|
September 30, 2017
|
(Decrease) in Fair
Market Value
|
Amounts
Settled
|
September 30, 2018
|
||||||||||
Natural Gas Distribution - Prices based on other external data
|
|
$
|
(8,467
|
)
|
|
5,892
|
|
|
(2,575
|
)
|
|
$
|
—
|
|
Home Services and Other - Prices based on other external data
|
|
—
|
|
|
335
|
|
|
(46
|
)
|
|
381
|
|
||
Total
|
|
$
|
(8,467
|
)
|
|
6,227
|
|
|
(2,621
|
)
|
|
$
|
381
|
|
|
Balance
|
Increase
|
Less
|
Balance
|
||||||||||
(Thousands)
|
September 30,
2017 |
(Decrease) in Fair
Market Value
|
Amounts
Settled
|
September 30,
2018 |
||||||||||
Energy Services
|
|
$
|
44
|
|
|
(379
|
)
|
|
(91
|
)
|
|
$
|
(244
|
)
|
(Thousands)
|
2019
|
2020
|
2021 - 2023
|
|
After 2023
|
|
Total
Fair Value |
||||||||
Prices based on other external data
|
$
|
(126
|
)
|
(84
|
)
|
|
(34
|
)
|
|
—
|
|
|
$
|
(244
|
)
|
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
|
$
|
—
|
|
$
|
(5,414
|
)
|
$
|
(10,829
|
)
|
$
|
(16,243
|
)
|
$
|
(21,657
|
)
|
Ending derivative fair value
|
$
|
5,081
|
|
$
|
(333
|
)
|
$
|
(5,748
|
)
|
$
|
(11,162
|
)
|
$
|
(16,576
|
)
|
Percent decrease in NYMEX natural gas futures prices
|
0%
|
(5)%
|
(10)%
|
(15)%
|
(20)%
|
||||||||||
Estimated change in derivative fair value
|
$
|
—
|
|
$
|
5,414
|
|
$
|
10,829
|
|
$
|
16,243
|
|
$
|
21,657
|
|
Ending derivative fair value
|
$
|
5,081
|
|
$
|
10,495
|
|
$
|
15,910
|
|
$
|
21,324
|
|
$
|
26,738
|
|
(Thousands)
|
Gross Credit Exposure
|
Net Credit Exposure
|
||||||
Investment grade
|
|
$
|
175,064
|
|
|
$
|
143,438
|
|
Noninvestment grade
|
|
43,419
|
|
|
10,648
|
|
||
Internally-rated investment grade
|
|
30,693
|
|
|
26,189
|
|
||
Internally-rated noninvestment grade
|
|
15,566
|
|
|
3,789
|
|
||
Total
|
|
$
|
264,742
|
|
|
$
|
184,064
|
|
(Thousands)
|
Gross Credit Exposure
|
Net Credit Exposure
|
||||||
Investment grade
|
|
$
|
4,918
|
|
|
$
|
4,121
|
|
Noninvestment grade
|
|
67
|
|
|
—
|
|
||
Internally-rated investment grade
|
|
93
|
|
|
43
|
|
||
Internally-rated noninvestment grade
|
|
10,184
|
|
|
—
|
|
||
Total
|
|
$
|
15,262
|
|
|
$
|
4,164
|
|
•
|
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,
|
2018
|
2017
|
2016
|
||||||
OPERATING REVENUES
|
|
|
|
||||||
Utility
|
$
|
731,865
|
|
$
|
695,637
|
|
$
|
594,346
|
|
Nonutility
|
2,183,244
|
|
1,572,980
|
|
1,286,559
|
|
|||
Total operating revenues
|
2,915,109
|
|
2,268,617
|
|
1,880,905
|
|
|||
OPERATING EXPENSES
|
|
|
|
||||||
Gas purchases:
|
|
|
|
||||||
Utility
|
276,005
|
|
258,687
|
|
205,034
|
|
|||
Nonutility
|
1,990,832
|
|
1,436,740
|
|
1,139,301
|
|
|||
Related parties
|
8,505
|
|
8,340
|
|
8,351
|
|
|||
Operation and maintenance
|
266,919
|
|
226,356
|
|
208,421
|
|
|||
Regulatory rider expenses
|
38,969
|
|
40,243
|
|
39,300
|
|
|||
Depreciation and amortization
|
85,701
|
|
81,841
|
|
72,748
|
|
|||
Energy and other taxes
|
52,102
|
|
49,366
|
|
40,215
|
|
|||
Total operating expenses
|
2,719,033
|
|
2,101,573
|
|
1,713,370
|
|
|||
OPERATING INCOME
|
196,076
|
|
167,044
|
|
167,535
|
|
|||
Other income, net
|
16,853
|
|
14,437
|
|
9,196
|
|
|||
Interest expense, net of capitalized interest
|
46,286
|
|
44,886
|
|
31,044
|
|
|||
INCOME BEFORE INCOME TAXES AND EQUITY IN EARNINGS OF AFFILIATES
|
166,643
|
|
136,595
|
|
145,687
|
|
|||
Income tax (benefit) provision
|
(53,785
|
)
|
18,343
|
|
23,530
|
|
|||
Equity in earnings of affiliates
|
13,008
|
|
13,813
|
|
9,515
|
|
|||
NET INCOME
|
$
|
233,436
|
|
$
|
132,065
|
|
$
|
131,672
|
|
|
|
|
|
||||||
EARNINGS PER COMMON SHARE
|
|
|
|
||||||
Basic
|
$2.66
|
$1.53
|
$1.53
|
||||||
Diluted
|
$2.64
|
$1.52
|
$1.52
|
||||||
WEIGHTED AVERAGE SHARES OUTSTANDING
|
|
|
|
||||||
Basic
|
87,689
|
|
86,321
|
|
85,884
|
|
|||
Diluted
|
88,315
|
|
87,144
|
|
86,731
|
|
(Thousands)
|
|
|
|
||||||
Fiscal years ended September 30,
|
2018
|
2017
|
2016
|
||||||
Net income
|
$
|
233,436
|
|
$
|
132,065
|
|
$
|
131,672
|
|
Other comprehensive income, net of tax:
|
|
|
|
||||||
Unrealized (loss) gain on available for sale securities, net of tax of 6,973, $(4,401) and $1,499, respectively
|
(19,245
|
)
|
6,846
|
|
(2,187
|
)
|
|||
Reclassifications of losses to net income on available for sale securities, net of tax of $(858), $0 and $0, respectively
|
11,647
|
|
—
|
|
—
|
|
|||
Adjustment to postemployment benefit obligation, net of tax of $(573), $(3,487) and $2,466, respectively
|
1,520
|
|
5,053
|
|
(3,574
|
)
|
|||
Other comprehensive (loss) income
|
(6,078
|
)
|
11,899
|
|
(5,761
|
)
|
|||
Comprehensive income
|
$
|
227,358
|
|
$
|
143,964
|
|
$
|
125,911
|
|
(1)
|
Available for sale securities are included in other noncurrent assets on the Consolidated Balance Sheets.
|
(Thousands)
|
|
|
|
|
|
||||||
Fiscal years ended September 30,
|
2018
|
|
2017
|
|
2016
|
||||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
||||||
Net income
|
$
|
233,436
|
|
|
$
|
132,065
|
|
|
$
|
131,672
|
|
Adjustments to reconcile net income to cash flows from operating activities
|
|
|
|
|
|
||||||
Unrealized loss (gain) on derivative instruments
|
26,770
|
|
|
(11,241
|
)
|
|
46,883
|
|
|||
Gain on sale of available for sale securities
|
(5,332
|
)
|
|
(7,287
|
)
|
|
—
|
|
|||
Gain on sale of businesses
|
(4,663
|
)
|
|
—
|
|
|
—
|
|
|||
Depreciation and amortization
|
85,701
|
|
|
81,841
|
|
|
72,748
|
|
|||
Amortization of acquired wholesale energy contracts
|
18,222
|
|
|
762
|
|
|
—
|
|
|||
Allowance for equity used during construction
|
(5,531
|
)
|
|
(3,867
|
)
|
|
(4,375
|
)
|
|||
Allowance for doubtful accounts
|
2,579
|
|
|
2,023
|
|
|
1,616
|
|
|||
Deferred income taxes
|
15,590
|
|
|
41,442
|
|
|
27,721
|
|
|||
Deferred income tax benefit due to tax legislation
|
(75,736
|
)
|
|
—
|
|
|
—
|
|
|||
Manufactured gas plant remediation costs
|
(16,171
|
)
|
|
(10,934
|
)
|
|
(8,106
|
)
|
|||
Equity in earnings, net of distributions received from equity investees
|
(1,725
|
)
|
|
(462
|
)
|
|
4,534
|
|
|||
Cost of removal - asset retirement obligations
|
(298
|
)
|
|
(484
|
)
|
|
(403
|
)
|
|||
Contributions to postemployment benefit plans
|
(6,359
|
)
|
|
(6,077
|
)
|
|
(33,359
|
)
|
|||
Tax benefit of delivered shares from stock based compensation
|
2,950
|
|
|
1,285
|
|
|
1,755
|
|
|||
Changes in:
|
|
|
|
|
|
||||||
Components of working capital
|
97,004
|
|
|
17,081
|
|
|
(123,325
|
)
|
|||
Other noncurrent assets
|
17,860
|
|
|
13,978
|
|
|
3,933
|
|
|||
Other noncurrent liabilities
|
13,989
|
|
|
(2,079
|
)
|
|
21,336
|
|
|||
Cash flows from operating activities
|
398,286
|
|
|
248,046
|
|
|
142,630
|
|
|||
CASH FLOWS USED IN INVESTING ACTIVITIES
|
|
|
|
|
|
||||||
Expenditures for:
|
|
|
|
|
|
||||||
Utility plant
|
(206,880
|
)
|
|
(144,106
|
)
|
|
(176,067
|
)
|
|||
Solar and wind equipment
|
(123,421
|
)
|
|
(149,400
|
)
|
|
(149,063
|
)
|
|||
Midstream and other
|
(6,644
|
)
|
|
(2,434
|
)
|
|
(1,896
|
)
|
|||
Cost of removal
|
(47,643
|
)
|
|
(32,143
|
)
|
|
(29,066
|
)
|
|||
Acquisition of retail and wholesale energy contracts
|
—
|
|
|
(55,661
|
)
|
|
—
|
|
|||
Investments in equity investees
|
(16,151
|
)
|
|
(27,070
|
)
|
|
(11,176
|
)
|
|||
Distributions from equity investees in excess of equity in earnings
|
3,117
|
|
|
2,749
|
|
|
2,351
|
|
|||
Cash paid related to acquisition
|
(10,000
|
)
|
|
—
|
|
|
—
|
|
|||
(Deposits to) withdrawal from restricted cash construction fund
|
(9
|
)
|
|
1,322
|
|
|
979
|
|
|||
Proceeds from sale of property, net of closing costs
|
—
|
|
|
9,443
|
|
|
748
|
|
|||
Proceeds from sale of businesses, net of closing costs
|
27,916
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from sale of available for sale securities, net
|
6,616
|
|
|
6,639
|
|
|
—
|
|
|||
Cash flows used in investing activities
|
(373,099
|
)
|
|
(390,661
|
)
|
|
(363,190
|
)
|
|||
CASH FLOWS (USED IN) FROM FINANCING ACTIVITIES
|
|
|
|
|
|
||||||
Proceeds from long-term debt
|
225,000
|
|
|
100,000
|
|
|
275,000
|
|
|||
Payments of long-term debt
|
(165,486
|
)
|
|
(97,854
|
)
|
|
(13,289
|
)
|
|||
(Payments of) proceeds from short-term debt, net
|
(114,050
|
)
|
|
144,300
|
|
|
55,350
|
|
|||
Proceeds from sale-leaseback transaction - solar
|
71,538
|
|
|
32,901
|
|
|
—
|
|
|||
Proceeds from sale-leaseback transaction - gas meters
|
7,820
|
|
|
9,587
|
|
|
7,107
|
|
|||
Payments of common stock dividends
|
(95,835
|
)
|
|
(87,988
|
)
|
|
(82,445
|
)
|
|||
Proceeds from waiver discount issuance of common stock
|
41,677
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from issuance of common stock
|
17,136
|
|
|
17,492
|
|
|
16,010
|
|
|||
Purchases of treasury stock
|
—
|
|
|
(6,355
|
)
|
|
(1,008
|
)
|
|||
Tax withholding payments related to net settled stock compensation
|
(13,755
|
)
|
|
(4,788
|
)
|
|
(3,547
|
)
|
|||
Cash flows (used in) from financing activities
|
(25,955
|
)
|
|
107,295
|
|
|
253,178
|
|
|||
Change in cash and cash equivalents
|
(768
|
)
|
|
(35,320
|
)
|
|
32,618
|
|
|||
Cash and cash equivalents at beginning of period
|
2,226
|
|
|
37,546
|
|
|
4,928
|
|
|||
Cash and cash equivalents at end of period
|
$
|
1,458
|
|
|
$
|
2,226
|
|
|
$
|
37,546
|
|
CHANGES IN COMPONENTS OF WORKING CAPITAL
|
|
|
|
|
|
||||||
Receivables
|
$
|
(7,524
|
)
|
|
$
|
(56,974
|
)
|
|
$
|
11,303
|
|
Inventories
|
15,464
|
|
|
3,022
|
|
|
(45,986
|
)
|
|||
Recovery of gas costs
|
30,439
|
|
|
(90
|
)
|
|
(39,642
|
)
|
|||
Gas purchases payable
|
51,187
|
|
|
20,663
|
|
|
(11,963
|
)
|
|||
Gas purchases payable - related parties
|
(1
|
)
|
|
2
|
|
|
(411
|
)
|
|||
Prepaid and accrued taxes
|
1,254
|
|
|
10,366
|
|
|
2,385
|
|
|||
Accounts payable and other
|
40,422
|
|
|
13,086
|
|
|
(15,656
|
)
|
|||
Restricted broker margin accounts
|
(30,974
|
)
|
|
22,570
|
|
|
(38,752
|
)
|
|||
Customers’ credit balances and deposits
|
368
|
|
|
(5,877
|
)
|
|
12,044
|
|
|||
Other current assets
|
(3,631
|
)
|
|
10,313
|
|
|
3,353
|
|
|||
Total
|
$
|
97,004
|
|
|
$
|
17,081
|
|
|
$
|
(123,325
|
)
|
SUPPLEMENTAL DISCLOSURES
|
|
|
|
|
|
||||||
Cash paid (received) for:
|
|
|
|
|
|
||||||
Interest (net of amounts capitalized)
|
$
|
44,821
|
|
|
$
|
44,362
|
|
|
$
|
31,996
|
|
Income taxes
|
$
|
5,577
|
|
|
$
|
(6,877
|
)
|
|
$
|
(3,516
|
)
|
Accrued capital expenditures
|
$
|
30,559
|
|
|
$
|
21,769
|
|
|
$
|
48,881
|
|
Inception gain on natural gas swap contract recognized as non-cash proceeds from sale of business
|
$
|
14,579
|
|
|
$
|
—
|
|
|
$
|
—
|
|
See Notes to Consolidated Financial Statements
|
(Thousands)
|
|
|
||||
September 30,
|
2018
|
2017
|
||||
|
|
|
||||
PROPERTY, PLANT AND EQUIPMENT
|
|
|
||||
Utility plant, at cost
|
$
|
2,368,914
|
|
$
|
2,241,324
|
|
Construction work in progress
|
192,481
|
|
119,318
|
|
||
Nonutility plant and equipment, at cost
|
697,406
|
|
843,142
|
|
||
Construction work in progress
|
45,690
|
|
7,286
|
|
||
Total property, plant and equipment
|
3,304,491
|
|
3,211,070
|
|
||
Accumulated depreciation and amortization, utility plant
|
(530,753
|
)
|
(489,122
|
)
|
||
Accumulated depreciation and amortization, nonutility plant and equipment
|
(122,689
|
)
|
(112,207
|
)
|
||
Property, plant and equipment, net
|
2,651,049
|
|
2,609,741
|
|
||
|
|
|
||||
CURRENT ASSETS
|
|
|
||||
Cash and cash equivalents
|
1,458
|
|
2,226
|
|
||
Customer accounts receivable:
|
|
|
||||
Billed
|
205,490
|
|
196,467
|
|
||
Unbilled revenues
|
7,199
|
|
7,202
|
|
||
Allowance for doubtful accounts
|
(5,704
|
)
|
(5,181
|
)
|
||
Regulatory assets
|
18,297
|
|
50,791
|
|
||
Gas in storage, at average cost
|
184,633
|
|
202,063
|
|
||
Materials and supplies, at average cost
|
13,910
|
|
11,944
|
|
||
Prepaid and accrued taxes
|
23,047
|
|
24,764
|
|
||
Derivatives, at fair value
|
27,396
|
|
30,081
|
|
||
Restricted broker margin accounts
|
53,719
|
|
25,827
|
|
||
Asset held for sale
|
206,905
|
|
—
|
|
||
Other current assets
|
33,730
|
|
33,260
|
|
||
Total current assets
|
770,080
|
|
579,444
|
|
||
|
|
|
||||
NONCURRENT ASSETS
|
|
|
||||
Investments in equity investees
|
190,866
|
|
172,585
|
|
||
Regulatory assets
|
368,592
|
|
375,919
|
|
||
Derivatives, at fair value
|
10,560
|
|
9,164
|
|
||
Available for sale securities
|
32,917
|
|
65,752
|
|
||
Intangible assets
|
23,375
|
|
41,084
|
|
||
Other noncurrent assets
|
96,225
|
|
74,818
|
|
||
Total noncurrent assets
|
722,535
|
|
739,322
|
|
||
Total assets
|
$
|
4,143,664
|
|
$
|
3,928,507
|
|
(Thousands, except share data)
|
|
|
||||
September 30,
|
2018
|
2017
|
||||
|
|
|
||||
CAPITALIZATION
|
|
|
||||
Common stock, $2.50 par value; authorized 150,000,000 shares;
Outstanding September 30, 2018 — 88,292,956; September 30, 2017 — 86,555,507
|
$
|
226,196
|
|
$
|
222,258
|
|
Premium on common stock
|
274,748
|
|
219,696
|
|
||
Accumulated other comprehensive loss, net of tax
|
(12,610
|
)
|
(3,256
|
)
|
||
Treasury stock, at cost and other;
Shares September 30, 2018 — 2,185,013; September 30, 2017 — 2,347,380
|
(76,473
|
)
|
(70,039
|
)
|
||
Retained earnings
|
1,007,117
|
|
867,984
|
|
||
Common stock equity
|
1,418,978
|
|
1,236,643
|
|
||
Long-term debt
|
1,180,619
|
|
997,080
|
|
||
Total capitalization
|
2,599,597
|
|
2,233,723
|
|
||
|
|
|
||||
CURRENT LIABILITIES
|
|
|
||||
Current maturities of long-term debt
|
123,545
|
|
165,375
|
|
||
Short-term debt
|
151,950
|
|
266,000
|
|
||
Gas purchases payable
|
211,303
|
|
160,115
|
|
||
Gas purchases payable to related parties
|
1,150
|
|
1,152
|
|
||
Accounts payable and other
|
135,240
|
|
96,878
|
|
||
Dividends payable
|
25,824
|
|
23,586
|
|
||
Accrued taxes
|
1,568
|
|
2,031
|
|
||
Regulatory liabilities
|
8,185
|
|
78
|
|
||
New Jersey Clean Energy Program
|
14,052
|
|
14,202
|
|
||
Derivatives, at fair value
|
46,652
|
|
46,544
|
|
||
Liabilities held for sale
|
4,182
|
|
—
|
|
||
Customers’ credit balances and deposits
|
27,325
|
|
26,957
|
|
||
Total current liabilities
|
750,976
|
|
802,918
|
|
||
|
|
|
||||
NONCURRENT LIABILITIES
|
|
|
||||
Deferred income taxes
|
242,436
|
|
514,708
|
|
||
Deferred investment tax credits
|
3,976
|
|
4,297
|
|
||
Deferred gain
|
9,104
|
|
27,728
|
|
||
Derivatives, at fair value
|
22,982
|
|
11,330
|
|
||
Manufactured gas plant remediation
|
130,800
|
|
149,000
|
|
||
Postemployment employee benefit liability
|
137,007
|
|
128,888
|
|
||
Regulatory liabilities
|
209,139
|
|
14,507
|
|
||
Asset retirement obligation
|
28,688
|
|
31,420
|
|
||
Other noncurrent liabilities
|
8,959
|
|
9,988
|
|
||
Total noncurrent liabilities
|
793,091
|
|
891,866
|
|
||
Commitments and contingent liabilities (Note 13)
|
|
|
|
|||
Total capitalization and liabilities
|
$
|
4,143,664
|
|
$
|
3,928,507
|
|
(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, 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
|
|
||||||
Net income
|
|
|
|
|
|
|
|
233,436
|
|
233,436
|
|
|||||||||||
Other comprehensive loss
|
|
|
|
|
(6,078
|
)
|
|
|
|
(6,078
|
)
|
|||||||||||
Common stock issued:
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Incentive compensation plan
|
561
|
|
1,403
|
|
15,169
|
|
|
|
|
|
|
16,572
|
|
|||||||||
Dividend reinvestment plan
(1)
|
413
|
|
|
755
|
|
|
|
|
16,339
|
|
|
17,094
|
|
|||||||||
Waiver discount
|
1,014
|
|
2,535
|
|
39,142
|
|
|
|
|
|
|
41,677
|
|
|||||||||
Cash dividend declared ($1.11 per share)
|
|
|
|
|
|
|
|
(97,579
|
)
|
(97,579
|
)
|
|||||||||||
Treasury stock and other
|
(251
|
)
|
|
(14
|
)
|
|
|
|
(22,773
|
)
|
|
(22,787
|
)
|
|||||||||
Reclassifications of certain income tax effects to retained earnings
(2)
|
|
|
|
|
(3,276
|
)
|
|
|
3,276
|
|
—
|
|
||||||||||
Balance at September 30, 2018
|
88,293
|
|
$
|
226,196
|
|
$
|
274,748
|
|
|
$
|
(12,610
|
)
|
|
$
|
(76,473
|
)
|
$
|
1,007,117
|
|
$
|
1,418,978
|
|
(1)
|
Shares sold through the DRP are issued from treasury stock at average cost, which may differ from the actual market price paid.
|
(2)
|
Due to the adoption of ASU No. 2018-02, an amendment to ASC 740,
Income Taxes
. See
Note 2. Summary of Significant Accounting Policies
- Recently Adopted Updates to the Accounting Standards Codification section for more details.
|
(Millions)
|
2018
|
2017
|
2016
|
||||||
Energy Services
|
$
|
153.0
|
|
$
|
126.4
|
|
$
|
141.0
|
|
Natural Gas Distribution
|
92.5
|
|
80.2
|
|
77.8
|
|
|||
Total
|
$
|
245.5
|
|
$
|
206.6
|
|
$
|
218.8
|
|
(1)
|
Reclassified to assets held for sale. See
Note 2. Summary of Significant Accounting Policies
, for more information.
|
(2)
|
Includes activity related to the acquisition of IEC by Adelphia. For fiscal 2017, Midstream property was originally included in All other property.
|
($ in thousands)
|
2018
|
2017
|
2016
|
||||||
AFUDC:
|
|
|
|
||||||
Debt
|
$
|
1,979
|
|
$
|
1,311
|
|
$
|
5,009
|
|
Equity
|
5,531
|
|
3,867
|
|
4,375
|
|
|||
Total
|
$
|
7,510
|
|
$
|
5,178
|
|
$
|
9,384
|
|
Weighted average interest rate
|
5.94
|
%
|
6.90
|
%
|
5.06
|
%
|
(Thousands)
|
2018
|
|
2017
|
||||||||
Energy Services
|
$
|
157,936
|
|
77
|
%
|
|
$
|
150,322
|
|
77
|
%
|
Natural Gas Distribution
(1)
|
39,151
|
|
19
|
|
|
37,432
|
|
19
|
|
||
Clean Energy Ventures
|
3,330
|
|
2
|
|
|
2,655
|
|
1
|
|
||
Home Services and Other Operations
|
5,073
|
|
2
|
|
|
6,058
|
|
3
|
|
||
Total
|
$
|
205,490
|
|
100
|
%
|
|
$
|
196,467
|
|
100
|
%
|
(1)
|
Does not include unbilled revenues of
$7.2 million
as of
September 30, 2018
and
2017
.
|
|
2018
|
2017
|
||||||||||
($ in thousands)
|
Gas in Storage
|
|
Bcf
|
Gas in Storage
|
|
Bcf
|
||||||
Energy Services
|
|
$
|
90,166
|
|
34.1
|
|
|
$
|
122,884
|
|
53.9
|
|
Natural Gas Distribution
|
|
94,467
|
|
24.9
|
|
|
79,179
|
|
21.8
|
|
||
Total
|
|
$
|
184,633
|
|
59.0
|
|
|
$
|
202,063
|
|
75.7
|
|
(Thousands)
|
September 30, 2017
|
|
Assets reclassified as held for sale
|
|
Assets
Sold
|
|
September 30, 2018
|
||||||||
Assets held for sale:
|
|
|
|
|
|
|
|
||||||||
Property, plant and equipment - wind equipment, at cost
|
$
|
—
|
|
|
$
|
245,044
|
|
|
$
|
(20,688
|
)
|
|
$
|
224,356
|
|
Property, plant and equipment - accumulated depreciation, wind equipment
|
—
|
|
|
(21,561
|
)
|
|
3,060
|
|
|
(18,501
|
)
|
||||
Prepaid and accrued taxes
|
—
|
|
|
866
|
|
|
(77
|
)
|
|
789
|
|
||||
Other noncurrent assets
|
—
|
|
|
261
|
|
|
—
|
|
|
261
|
|
||||
|
$
|
—
|
|
|
$
|
224,610
|
|
|
$
|
(17,705
|
)
|
|
$
|
206,905
|
|
Liabilities held for sale:
|
|
|
|
|
|
|
|
||||||||
Accounts payable and other
(1)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
186
|
|
|
$
|
186
|
|
Asset retirement obligation
|
—
|
|
|
4,262
|
|
|
(266
|
)
|
|
3,996
|
|
||||
|
$
|
—
|
|
|
$
|
4,262
|
|
|
$
|
(80
|
)
|
|
$
|
4,182
|
|
(1)
|
Transaction fee owed to broker for the sale of Two Dot wind farm.
|
(Thousands)
|
Unrealized gain (loss) on available for sale securities
|
Adjustment to postemployment benefit obligation
|
Total
|
||||||||
Balance as of 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), $(2,619), $(9,212)
|
10,019
|
|
|
3,783
|
|
|
13,802
|
|
|||
Amounts reclassified from accumulated other comprehensive (loss) income, net of tax of $2,192, $(868), $1,324
|
(3,173
|
)
|
|
1,270
|
|
(1)
|
(1,903
|
)
|
|||
Net current-period other comprehensive income, net of tax of $(4,401), $(3,487), $(7,888)
|
6,846
|
|
|
5,053
|
|
|
11,899
|
|
|||
Balance at September 30, 2017
|
$
|
11,044
|
|
|
$
|
(14,300
|
)
|
|
$
|
(3,256
|
)
|
Other comprehensive income, net of tax
|
|
|
|
|
|
||||||
Other comprehensive (loss) income, before reclassifications, net of tax of $6,973, $(125), $6,848
|
(19,245
|
)
|
|
464
|
|
|
(18,781
|
)
|
|||
Amounts reclassified from accumulated other comprehensive income, net of tax of $(858), $(448), $(1,306)
|
11,647
|
|
|
1,056
|
|
(1)
|
12,703
|
|
|||
Net current-period other comprehensive (loss) income, net of tax of $6,115, $(573), $5,542
|
(7,598
|
)
|
|
1,520
|
|
|
(6,078
|
)
|
|||
Reclassifications of certain income tax effects to retained earnings
(2)
|
—
|
|
|
(3,276
|
)
|
|
(3,276
|
)
|
|||
Balance at September 30, 2018
|
$
|
3,446
|
|
|
$
|
(16,056
|
)
|
|
$
|
(12,610
|
)
|
(1)
|
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 10. Employee Benefit Plans
.
|
(2)
|
Due to the adoption of ASU No. 2018-02, an amendment to ASC 740,
Income Taxes
. See
Note 2. Summary of Significant Accounting Policies
-
Recently Adopted Updates to the Accounting Standards Codification
section for more details.
|
(Thousands)
|
2018
|
2017
|
||||
Regulatory assets-current
|
|
|
||||
New Jersey Clean Energy Program
|
$
|
14,052
|
|
$
|
14,202
|
|
Underrecovered gas costs
|
4,137
|
|
9,910
|
|
||
Derivatives at fair value, net
|
108
|
|
9,010
|
|
||
Conservation Incentive Program
|
—
|
|
17,669
|
|
||
Total current regulatory assets
|
$
|
18,297
|
|
$
|
50,791
|
|
Regulatory assets-noncurrent
|
|
|
||||
Environmental remediation costs:
|
|
|
||||
Expended, net of recoveries
|
$
|
33,017
|
|
$
|
28,547
|
|
Liability for future expenditures
|
130,800
|
|
149,000
|
|
||
Deferred income taxes
|
17,225
|
|
21,795
|
|
||
SAVEGREEN
|
8,636
|
|
16,302
|
|
||
Postemployment and other benefit costs
|
136,716
|
|
141,433
|
|
||
Deferred storm damage costs
|
10,858
|
|
13,030
|
|
||
Cost of removal
|
22,339
|
|
—
|
|
||
Other noncurrent regulatory assets
|
9,001
|
|
5,812
|
|
||
Total noncurrent regulatory assets
|
$
|
368,592
|
|
$
|
375,919
|
|
Regulatory liability-current
|
|
|
||||
Conservation Incentive Program
|
$
|
6,994
|
|
$
|
—
|
|
Derivatives at fair value, net
|
1,191
|
|
78
|
|
||
Total current regulatory liabilities
|
$
|
8,185
|
|
$
|
78
|
|
Regulatory liabilities-noncurrent
|
|
|
||||
Tax Act impact
(1)
|
$
|
205,410
|
|
$
|
—
|
|
Cost of removal
|
—
|
|
7,902
|
|
||
New Jersey Clean Energy Program
|
1,902
|
|
5,795
|
|
||
Other noncurrent regulatory liabilities
|
1,827
|
|
810
|
|
||
Total noncurrent regulatory liabilities
|
$
|
209,139
|
|
$
|
14,507
|
|
(1)
|
Includes an adjustment
related to the re-measurement of NJNG's net deferred tax liabilities to reflect the change in federal tax rates enacted in the
Tax Act, which is net of sales tax collected from customers
. For a more detailed discussion
,
s
ee
Note 12. Income Taxes
.
|
•
|
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 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. A total of
$42 million
in bill credits were issued during fiscal 2017.
|
•
|
June 2017 BGSS/CIP filing
—
In
March 2018
, the BPU approved NJNG’s petition on a final basis to maintain its BGSS rate for residential and small commercial customers, increase its balancing charge rate, which resulted in a
$3.7 million
increase to the annual revenues credited to BGSS, and decrease its CIP rates, which resulted in a
$16.2 million
annual recovery decrease that was effective
October 2017
.
|
•
|
May 2018 BGSS/CIP filing
—
On
September 17, 2018
, the BPU provisionally approved NJNG’s annual petition to maintain its BGSS rate for residential and small commercial customers and increase its balancing charge rate, resulting in a
$10.3 million
increase to the annual revenues credited to BGSS, as well as changes to the CIP rates, which will result in a
$30.9 million
annual recovery decrease effective
October 2018
.
|
•
|
2017 SBC filing
—
In
September 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
July 25, 2018
, the BPU approved NJNG's annual SBC filing requesting to recover remediation expenses incurred through June 30, 2017, a reduction in the RAC, which resulted in an annual decrease of
$2.4 million
, and to increase the NJCEP factor, which will result in an annual increase of
$1.8 million
, effective
September 1, 2018
.
|
•
|
2018 SBC filing
—
On
September 17, 2018
, the BPU approved NJNG’s annual USF compliance filing to increase the statewide USF rate, which will result in a
$1 million
annual increase, effective
October 1, 2018
. On
September 21, 2018
, NJNG filed its annual SBC application requesting to recover remediation expenses incurred through June 30, 2018, an increase in the RAC, which will result in an annual increase of
$1.4 million
, and an increase to the NJCEP factor, which will result in an annual increase of approximately
$1.9 million
, effective
April 1, 2019
.
|
|
|
|
Fair Value
|
||||||||||||||
|
|
|
2018
|
|
2017
|
||||||||||||
(Thousands)
|
Balance Sheet Location
|
Asset
Derivatives
|
Liability
Derivatives
|
Asset
Derivatives
|
Liability
Derivatives
|
||||||||||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|||||||||
Natural Gas Distribution:
|
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
Derivatives - current
|
|
$
|
85
|
|
|
$
|
192
|
|
|
$
|
151
|
|
|
$
|
72
|
|
Financial commodity contracts
|
Derivatives - current
|
|
94
|
|
|
—
|
|
|
—
|
|
|
1,149
|
|
||||
Interest rate contracts
(1)
|
Derivatives - current
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,467
|
|
||||
Energy Services:
|
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
Derivatives - current
|
|
7,667
|
|
|
18,158
|
|
|
14,588
|
|
|
16,589
|
|
||||
|
Derivatives - noncurrent
|
|
3,930
|
|
|
11,316
|
|
|
7,127
|
|
|
8,710
|
|
||||
Financial commodity contracts
|
Derivatives - current
|
|
19,169
|
|
|
28,176
|
|
|
15,302
|
|
|
20,267
|
|
||||
|
Derivatives - noncurrent
|
|
6,630
|
|
|
11,548
|
|
|
2,033
|
|
|
2,620
|
|
||||
Foreign currency contracts
|
Derivatives - current
|
|
—
|
|
|
126
|
|
|
40
|
|
|
—
|
|
||||
|
Derivatives - noncurrent
|
|
—
|
|
|
118
|
|
|
4
|
|
|
—
|
|
||||
Home Services and Other:
|
|
|
|
|
|
|
|
|
|
||||||||
Interest rate contracts
|
Derivatives - current
|
|
381
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total fair value of derivatives
|
|
|
$
|
37,956
|
|
|
$
|
69,634
|
|
|
$
|
39,245
|
|
|
$
|
57,874
|
|
(1)
|
Includes treasury lock which was settled in
March 2018
. See
Note 8. Debt
for more information.
|
(Thousands)
|
Amounts Presented in Balance Sheets
(1)
|
Offsetting Derivative Instruments
(2)
|
Financial Collateral Received/Pledged
(3)
|
Net Amounts
(4)
|
||||||||||||
As of September 30, 2018:
|
|
|
|
|
|
|
|
|
||||||||
Derivative assets:
|
|
|
|
|
|
|
|
|
||||||||
Energy Services
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
11,597
|
|
|
$
|
(3,944
|
)
|
|
$
|
(200
|
)
|
|
$
|
7,453
|
|
Financial commodity contracts
|
|
25,799
|
|
|
(18,775
|
)
|
|
—
|
|
|
7,024
|
|
||||
Total Energy Services
|
|
$
|
37,396
|
|
|
$
|
(22,719
|
)
|
|
$
|
(200
|
)
|
|
$
|
14,477
|
|
Natural Gas Distribution
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
85
|
|
|
$
|
(3
|
)
|
|
$
|
—
|
|
|
$
|
82
|
|
Financial commodity contracts
|
|
94
|
|
|
—
|
|
|
(94
|
)
|
|
—
|
|
||||
Total Natural Gas Distribution
|
|
$
|
179
|
|
|
$
|
(3
|
)
|
|
$
|
(94
|
)
|
|
$
|
82
|
|
Home Services and Other
|
|
|
|
|
|
|
|
|
||||||||
Interest rate contracts
|
|
$
|
381
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
381
|
|
Total Home Services and Other
|
|
$
|
381
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
381
|
|
Derivative liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Energy Services
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
29,474
|
|
|
$
|
(3,944
|
)
|
|
$
|
—
|
|
|
$
|
25,530
|
|
Financial commodity contracts
|
|
39,724
|
|
|
(18,775
|
)
|
|
(20,949
|
)
|
|
—
|
|
||||
Foreign currency contracts
|
|
244
|
|
|
—
|
|
|
—
|
|
|
244
|
|
||||
Total Energy Services
|
|
$
|
69,442
|
|
|
$
|
(22,719
|
)
|
|
$
|
(20,949
|
)
|
|
$
|
25,774
|
|
Natural Gas Distribution
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
192
|
|
|
$
|
(3
|
)
|
|
$
|
—
|
|
|
$
|
189
|
|
Total Natural Gas Distribution
|
|
$
|
192
|
|
|
$
|
(3
|
)
|
|
$
|
—
|
|
|
$
|
189
|
|
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
|
|
Natural Gas Distribution
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
151
|
|
|
$
|
(20
|
)
|
|
$
|
—
|
|
|
$
|
131
|
|
Total Natural Gas Distribution
|
|
$
|
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
|
)
|
|
—
|
|
||||
Total Energy Services
|
|
$
|
48,186
|
|
|
$
|
(16,294
|
)
|
|
$
|
(8,766
|
)
|
|
$
|
23,126
|
|
Natural Gas Distribution
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
72
|
|
|
$
|
(20
|
)
|
|
$
|
—
|
|
|
$
|
52
|
|
Financial commodity contracts
|
|
1,149
|
|
|
—
|
|
|
(1,149
|
)
|
|
—
|
|
||||
Interest rate contracts
|
|
8,467
|
|
|
—
|
|
|
—
|
|
|
8,467
|
|
||||
Total Natural Gas Distribution
|
|
$
|
9,688
|
|
|
$
|
(20
|
)
|
|
$
|
(1,149
|
)
|
|
$
|
8,519
|
|
(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:
|
2018
|
|
2017
|
|
2016
|
|||||||
Energy Services:
|
|
|
|
|
|
|
||||||
Physical commodity contracts
|
Operating revenues
|
$
|
(9,311
|
)
|
|
$
|
8,912
|
|
|
$
|
33,034
|
|
Physical commodity contracts
|
Gas purchases
|
(197
|
)
|
|
(27,461
|
)
|
|
(45,637
|
)
|
|||
Financial commodity contracts
|
Gas purchases
|
(24,622
|
)
|
|
26,563
|
|
|
45,579
|
|
|||
Foreign currency contracts
|
Gas purchases
|
(379
|
)
|
|
41
|
|
|
(34
|
)
|
|||
Home Services and Other:
|
|
|
|
|
|
|
||||||
Interest rate contracts
|
Interest expense
|
334
|
|
|
—
|
|
|
—
|
|
|||
Total unrealized and realized gains (losses)
|
$
|
(34,175
|
)
|
|
$
|
8,055
|
|
|
$
|
32,942
|
|
(Thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Natural Gas Distribution:
|
|
|
|
|
|
||||||
Physical commodity contracts
|
$
|
1,232
|
|
|
$
|
(12,303
|
)
|
|
$
|
(15,756
|
)
|
Financial commodity contracts
|
1,844
|
|
|
5,595
|
|
|
(7,984
|
)
|
|||
Interest rate contracts
|
8,467
|
|
|
14,606
|
|
|
(18,845
|
)
|
|||
Total unrealized and realized (losses) gains
|
$
|
11,543
|
|
|
$
|
7,898
|
|
|
$
|
(42,585
|
)
|
|
|
|
Volume (Bcf)
|
||||
|
|
|
2018
|
|
2017
|
||
Natural Gas Distribution
|
Futures
|
|
27.9
|
|
|
18.2
|
|
|
Physical
|
|
23.1
|
|
|
32.1
|
|
Energy Services
|
Futures
|
|
(7.0
|
)
|
|
(16.4
|
)
|
|
Physical
|
|
51.2
|
|
|
(13.1
|
)
|
(Thousands)
|
Balance Sheet Location
|
2018
|
2017
|
||||
Natural Gas Distribution
|
Broker margin - Current assets
|
$
|
2,038
|
|
$
|
2,661
|
|
Energy Services
|
Broker margin - Current assets
|
$
|
51,681
|
|
$
|
23,166
|
|
(Thousands)
|
Gross Credit
Exposure
|
||||
Investment grade
|
|
$
|
179,982
|
|
|
Noninvestment grade
|
|
43,486
|
|
|
|
Internally-rated investment grade
|
|
30,786
|
|
|
|
Internally-rated noninvestment grade
|
|
25,750
|
|
|
|
Total
|
|
$
|
280,004
|
|
|
(Thousands)
|
2018
|
2017
|
||||
NJNG
|
|
|
||||
Carrying value
|
$
|
672,045
|
|
$
|
672,045
|
|
Fair market value
|
$
|
669,162
|
|
$
|
673,051
|
|
NJR
|
|
|
||||
Carrying value
|
$
|
500,000
|
|
$
|
425,000
|
|
Fair market value
|
$
|
488,889
|
|
$
|
434,625
|
|
(1)
|
See
Note 8. Debt
f
or a reconciliation to long-term and short-term debt
.
|
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). 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, 2018:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
—
|
|
|
|
$
|
11,682
|
|
|
|
$
|
—
|
|
|
$
|
11,682
|
|
Financial commodity contracts
|
|
18,868
|
|
|
|
7,025
|
|
|
|
—
|
|
|
25,893
|
|
||||
Financial commodity contracts - foreign exchange
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
||||
Interest rate contract
|
|
—
|
|
|
|
381
|
|
|
|
—
|
|
|
381
|
|
||||
Available for sale equity securities
|
|
32,917
|
|
|
|
—
|
|
|
|
—
|
|
|
32,917
|
|
||||
Other
(1)
|
|
1,217
|
|
|
|
—
|
|
|
|
—
|
|
|
1,217
|
|
||||
Total assets at fair value
|
|
$
|
53,002
|
|
|
|
$
|
19,088
|
|
|
|
$
|
—
|
|
|
$
|
72,090
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
||||||||
Physical commodity contracts
|
|
$
|
—
|
|
|
|
$
|
29,666
|
|
|
|
$
|
—
|
|
|
$
|
29,666
|
|
Financial commodity contracts
|
|
39,724
|
|
|
|
—
|
|
|
|
—
|
|
|
39,724
|
|
||||
Financial commodity contracts - foreign exchange
|
|
—
|
|
|
|
244
|
|
|
|
—
|
|
|
244
|
|
||||
Total liabilities at fair value
|
|
$
|
39,724
|
|
|
|
$
|
29,910
|
|
|
|
$
|
—
|
|
|
$
|
69,634
|
|
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
|
|
||||
Other
(1)
|
|
1,202
|
|
|
|
—
|
|
|
|
—
|
|
|
1,202
|
|
||||
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
|
|
||||
Interest rate contract
|
|
—
|
|
|
|
8,467
|
|
|
|
—
|
|
|
8,467
|
|
||||
Total liabilities at fair value
|
|
$
|
24,036
|
|
|
|
$
|
33,838
|
|
|
|
$
|
—
|
|
|
$
|
57,874
|
|
(1)
|
Includes money market funds.
|
(Thousands)
|
2018
|
2017
|
||||
Steckman Ridge
(1)
|
$
|
117,001
|
|
$
|
120,262
|
|
PennEast
|
73,865
|
|
52,323
|
|
||
Total
|
$
|
190,866
|
|
$
|
172,585
|
|
(Thousands, except per share amounts)
|
2018
|
2017
|
2016
|
||||||
Net income, as reported
|
$
|
233,436
|
|
$
|
132,065
|
|
$
|
131,672
|
|
Basic earnings per share
|
|
|
|
||||||
Weighted average shares of common stock outstanding-basic
|
87,689
|
|
86,321
|
|
85,884
|
|
|||
Basic earnings per common share
|
$2.66
|
$1.53
|
$1.53
|
||||||
Diluted earnings per share
|
|
|
|
||||||
Weighted average shares of common stock outstanding-basic
|
87,689
|
|
86,321
|
|
85,884
|
|
|||
Incremental shares
(1)
|
626
|
|
823
|
|
847
|
|
|||
Weighted average shares of common stock outstanding-diluted
|
88,315
|
|
87,144
|
|
86,731
|
|
|||
Diluted earnings per common share
(2)
|
$2.64
|
$1.52
|
$1.52
|
(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 2018
,
2017
and
2016
.
|
(Thousands)
|
NJNG
|
NJR
|
||||
2019
|
$
|
—
|
|
$
|
100,000
|
|
2020
|
$
|
—
|
|
$
|
—
|
|
2021
|
$
|
—
|
|
$
|
—
|
|
2022
|
$
|
—
|
|
$
|
50,000
|
|
2023
|
$
|
—
|
|
$
|
50,000
|
|
Thereafter
|
$
|
672,045
|
|
$
|
300,000
|
|
(Thousands)
|
Lease Payments
|
|
||
2019
|
|
$
|
10,932
|
|
2020
|
|
7,989
|
|
|
2021
|
|
9,236
|
|
|
2022
|
|
3,775
|
|
|
2023
|
|
2,393
|
|
|
Thereafter
|
|
5,245
|
|
|
Subtotal
|
|
39,570
|
|
|
Less: Interest component
|
|
(3,633
|
)
|
|
Total
|
|
$
|
35,937
|
|
(Thousands)
|
Lease Payments
|
|
||
2019
|
|
$
|
9,794
|
|
2020
|
|
7,830
|
|
|
2021
|
|
7,803
|
|
|
2022
|
|
7,802
|
|
|
2023
|
|
7,878
|
|
|
Thereafter
|
|
38,303
|
|
|
Subtotal
|
|
79,410
|
|
|
Less: Interest component
|
|
(26,728
|
)
|
|
Total
|
|
$
|
52,682
|
|
(Thousands)
|
2018
|
|
2017
|
||||
NJR
|
|
|
|
||||
Bank revolving credit facilities:
(1)
|
$
|
425,000
|
|
|
$
|
425,000
|
|
Notes outstanding at end of period
|
$
|
87,950
|
|
|
$
|
255,000
|
|
Weighted average interest rate at end of period
|
3.07
|
%
|
|
2.14
|
%
|
||
Amount available at end of period
(2)
|
$
|
322,144
|
|
|
$
|
156,601
|
|
NJNG
|
|
|
|
||||
Bank revolving credit facilities:
(3)
|
$
|
250,000
|
|
|
$
|
250,000
|
|
Commercial paper outstanding at end of period
|
$
|
64,000
|
|
|
$
|
11,000
|
|
Weighted average interest rate at end of period
|
2.18
|
%
|
|
1.13
|
%
|
||
Amount available at end of period
(4)
|
$
|
185,269
|
|
|
$
|
238,269
|
|
(1)
|
Committed credit facilities, which require commitment fees of
.075 percent
on the unused amounts.
|
(2)
|
Letters of credit outstanding total
$14.9 million
and
$13.4 million
as of
September 30, 2018
and
2017
, 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, 2018
and
2017
, which reduces amount available by the same amount.
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Stock-based compensation expense:
|
|
|
|
||||||
Performance share awards
|
$
|
3,526
|
|
$
|
2,614
|
|
$
|
3,188
|
|
Restricted and non-restricted stock
|
2,191
|
|
1,732
|
|
2,161
|
|
|||
Deferred retention stock
|
7,128
|
|
1,461
|
|
1,885
|
|
|||
Compensation expense included in operation and maintenance expense
|
12,845
|
|
5,807
|
|
7,234
|
|
|||
Income tax benefit
(1)
|
(3,734
|
)
|
(2,372
|
)
|
(2,955
|
)
|
|||
Total, net of tax
|
$
|
9,111
|
|
$
|
3,435
|
|
$
|
4,279
|
|
(1)
|
Excludes additional tax benefit related to delivered
shares of
$3 million
,
$1.3 million
and
$1.8 million
as of
September 30, 2018
,
2017
and
2016
, respectively.
|
|
Shares
(1)
|
Weighted Average
Grant Date
Fair Value
|
Total Fair Value of Vested Shares (in Thousands)
|
|||||||
Non-vested and outstanding at September 30, 2015
|
214,464
|
|
|
$23.40
|
|
|
—
|
|
|
|
Granted
|
115,480
|
|
|
$27.37
|
|
|
—
|
|
|
|
Vested
(2)
|
(137,053
|
)
|
|
$21.40
|
|
|
$
|
5,657
|
|
|
Cancelled/forfeited
(3)
|
(12,975
|
)
|
|
$23.40
|
|
|
—
|
|
|
|
Non-vested and outstanding at September 30, 2016
|
179,916
|
|
|
$27.47
|
|
|
—
|
|
|
|
Granted
|
96,507
|
|
|
$33.57
|
|
|
—
|
|
|
|
Vested
(4)
|
(95,407
|
)
|
|
$28.88
|
|
|
$
|
4,179
|
|
|
Cancelled/forfeited
|
(24,429
|
)
|
|
$29.14
|
|
|
—
|
|
|
|
Non-vested and outstanding at September 30, 2017
|
156,587
|
|
|
$30.12
|
|
|
—
|
|
|
|
Granted
|
91,177
|
|
|
$44.67
|
|
|
—
|
|
|
|
Vested
(5)
|
(100,146
|
)
|
|
$29.49
|
|
|
$
|
4,714
|
|
|
Cancelled/forfeited
|
(2,442
|
)
|
|
$31.45
|
|
|
—
|
|
|
|
Non-vested and outstanding at September 30, 2018
|
145,176
|
|
|
$39.67
|
|
|
—
|
|
|
(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 15, 2016
, the number of common shares related to performance shares earned 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
.
|
(3)
|
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.
|
(4)
|
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
.
|
(5)
|
As certified by the Company’s Leadership and Compensation Committee on
November 13, 2018
, the number of common shares earned related to TSR performance was
99 percent
or
38,660
shares, the number of common shares earned related to NFE performance was
121 percent
or
39,694
shares and the number of common shares earned related to Performance Based Restricted Stock was
100 percent
or
36,998
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, 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
|
|
|
—
|
|
|
|
Granted
|
27,949
|
|
|
$45.00
|
|
|
|
|
||
Vested
|
(33,815
|
)
|
|
$31.23
|
|
|
$
|
1,438
|
|
|
Cancelled/forfeited
|
(1,120
|
)
|
|
$33.54
|
|
|
|
|
||
Non-vested and outstanding at September 30, 2018
|
44,168
|
|
|
$41.24
|
|
|
—
|
|
|
|
Shares
|
Weighted Average
Grant Date
Fair Value
|
Total Fair Value of Vested Shares (in Thousands)
|
|||||||
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
|
|
|
—
|
|
|
|
Granted/Vested
|
24,167
|
|
|
$45.00
|
|
|
|
|
||
Delivered
|
(452,694
|
)
|
|
$29.42
|
|
|
$
|
19,581
|
|
|
Forfeited
|
(1,969
|
)
|
|
$35.56
|
|
|
|
|
||
Outstanding at September 30, 2018
|
242,082
|
|
|
$32.99
|
|
|
—
|
|
|
|
2018
|
2017
|
2016
|
|
Shares granted
|
26,524
|
(1)
|
27,972
|
27,481
|
Weighted average grant date fair value
|
$39.85
|
|
$35.59
|
$32.75
|
(1)
|
$264,000
of expense remains as of
September 30, 2018
, to be recognized through
December 31, 2018
.
|
|
Pension
(1)
|
OPEB
|
||||||||||
(Thousands)
|
2018
|
2017
|
2018
|
2017
|
||||||||
Change in Benefit Obligation
|
|
|
|
|
||||||||
Benefit obligation at beginning of year
|
$
|
297,835
|
|
$
|
293,654
|
|
$
|
175,090
|
|
$
|
160,393
|
|
Service cost
|
8,139
|
|
8,347
|
|
4,607
|
|
4,380
|
|
||||
Interest cost
|
10,493
|
|
9,771
|
|
6,365
|
|
5,545
|
|
||||
Plan participants’ contributions
(2)
|
45
|
|
45
|
|
161
|
|
120
|
|
||||
Special termination benefits
(3)
|
3,730
|
|
—
|
|
490
|
|
—
|
|
||||
Actuarial (gain) loss
|
(12,846
|
)
|
(5,995
|
)
|
15,145
|
|
8,985
|
|
||||
Benefits paid, net of retiree subsidies received
|
(8,821
|
)
|
(7,987
|
)
|
(5,073
|
)
|
(4,333
|
)
|
||||
Benefit obligation at end of year
|
$
|
298,575
|
|
$
|
297,835
|
|
$
|
196,785
|
|
$
|
175,090
|
|
Change in plan assets
|
|
|
|
|
||||||||
Fair value of plan assets at beginning of year
|
$
|
271,743
|
|
$
|
249,875
|
|
$
|
71,534
|
|
$
|
62,035
|
|
Actual return on plan assets
|
16,306
|
|
29,736
|
|
5,284
|
|
7,953
|
|
||||
Employer contributions
|
137
|
|
74
|
|
6,222
|
|
6,049
|
|
||||
Benefits paid, net of plan participants’ contributions
(2)
|
(8,776
|
)
|
(7,942
|
)
|
(5,060
|
)
|
(4,503
|
)
|
||||
Fair value of plan assets at end of year
|
$
|
279,410
|
|
$
|
271,743
|
|
$
|
77,980
|
|
$
|
71,534
|
|
Funded status
|
$
|
(19,165
|
)
|
$
|
(26,092
|
)
|
$
|
(118,805
|
)
|
$
|
(103,556
|
)
|
Amounts recognized on Consolidated Balance Sheets
|
|
|
|
|
||||||||
Postemployment employee (liability)
|
|
|
|
|
||||||||
Current
|
$
|
(294
|
)
|
$
|
(158
|
)
|
$
|
(669
|
)
|
$
|
(602
|
)
|
Noncurrent
|
(18,871
|
)
|
(25,934
|
)
|
(118,136
|
)
|
(102,954
|
)
|
||||
Total
|
$
|
(19,165
|
)
|
$
|
(26,092
|
)
|
$
|
(118,805
|
)
|
$
|
(103,556
|
)
|
(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.
|
(3)
|
Related to the voluntary early retirement program offered during fiscal 2018, as previously discussed.
|
|
Regulatory Assets
|
|
Accumulated Other Comprehensive Income (Loss)
|
||||||||||
|
Pension
|
OPEB
|
|
Pension
|
OPEB
|
||||||||
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
|
|
Amounts arising during the period:
|
|
|
|
|
|
||||||||
Net actuarial (gain) loss
|
(6,090
|
)
|
12,378
|
|
|
(3,422
|
)
|
2,834
|
|
||||
Amounts amortized to net periodic costs:
|
|
|
|
|
|
||||||||
Net actuarial (loss)
|
(6,177
|
)
|
(4,464
|
)
|
|
(1,359
|
)
|
(196
|
)
|
||||
Prior service (cost) credit
|
(105
|
)
|
311
|
|
|
(1
|
)
|
54
|
|
||||
Balance at September 30, 2018
|
$
|
66,233
|
|
$
|
68,685
|
|
|
$
|
14,633
|
|
$
|
7,659
|
|
|
Regulatory Assets
|
Accumulated Other Comprehensive Income (Loss)
|
||||||||||||||||||||||
|
Pension
|
OPEB
|
Pension
|
OPEB
|
||||||||||||||||||||
(Thousands)
|
2018
|
2017
|
2018
|
2017
|
2018
|
2017
|
2018
|
2017
|
||||||||||||||||
Net actuarial loss
|
$
|
65,664
|
|
$
|
77,930
|
|
$
|
69,477
|
|
$
|
61,563
|
|
$
|
14,633
|
|
$
|
19,414
|
|
$
|
7,750
|
|
$
|
5,113
|
|
Prior service cost (credit)
|
569
|
|
675
|
|
(792
|
)
|
(1,103
|
)
|
—
|
|
1
|
|
(91
|
)
|
(146
|
)
|
||||||||
Total
|
$
|
66,233
|
|
$
|
78,605
|
|
$
|
68,685
|
|
$
|
60,460
|
|
$
|
14,633
|
|
$
|
19,415
|
|
$
|
7,659
|
|
$
|
4,967
|
|
|
Regulatory Assets
|
|
Accumulated Other Comprehensive Income (Loss)
|
||||||||||
(Thousands)
|
Pension
|
OPEB
|
|
Pension
|
OPEB
|
||||||||
Net actuarial loss
|
$
|
4,662
|
|
$
|
5,527
|
|
|
$
|
1,103
|
|
$
|
643
|
|
Prior service cost (credit)
|
102
|
|
(312
|
)
|
|
—
|
|
(53
|
)
|
||||
Total
|
$
|
4,764
|
|
$
|
5,215
|
|
|
$
|
1,103
|
|
$
|
590
|
|
|
Pension
|
|||||
(Thousands)
|
2018
|
2017
|
||||
Projected benefit obligation
|
$
|
298,575
|
|
$
|
297,835
|
|
Accumulated benefit obligation
|
$
|
263,279
|
|
$
|
258,514
|
|
Fair value of plan assets
|
$
|
279,410
|
|
$
|
271,743
|
|
|
Pension
|
OPEB
|
||||||||||||||||
(Thousands)
|
2018
|
2017
|
2016
|
2018
|
2017
|
2016
|
||||||||||||
Service cost
|
$
|
8,139
|
|
$
|
8,347
|
|
$
|
7,591
|
|
$
|
4,607
|
|
$
|
4,380
|
|
$
|
4,521
|
|
Interest cost
|
10,493
|
|
9,771
|
|
11,342
|
|
6,365
|
|
5,545
|
|
6,256
|
|
||||||
Expected return on plan assets
|
(19,639
|
)
|
(19,313
|
)
|
(20,118
|
)
|
(5,352
|
)
|
(4,767
|
)
|
(4,845
|
)
|
||||||
Recognized actuarial loss
|
7,537
|
|
8,827
|
|
7,281
|
|
4,660
|
|
4,370
|
|
3,274
|
|
||||||
Prior service cost (credit) amortization
|
106
|
|
111
|
|
111
|
|
(365
|
)
|
(365
|
)
|
(365
|
)
|
||||||
Net periodic benefit cost
|
$
|
6,636
|
|
$
|
7,743
|
|
$
|
6,207
|
|
$
|
9,915
|
|
$
|
9,163
|
|
$
|
8,841
|
|
Special termination benefit
|
3,730
|
|
—
|
|
—
|
|
490
|
|
—
|
|
—
|
|
||||||
Net periodic benefit cost recognized as expense
|
$
|
10,366
|
|
$
|
7,743
|
|
$
|
6,207
|
|
$
|
10,405
|
|
$
|
9,163
|
|
$
|
8,841
|
|
|
Pension
|
|
OPEB
|
|
||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2018
|
|
2017
|
|
2016
|
|
||||||
Benefit costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Discount rate
|
4.04/4.03%
|
|
3.96/3.94%
|
|
|
4.50
|
%
|
|
4.12/4.08%
|
|
(1)
|
4.08/4.01%
|
|
(1)
|
4.60/4.55%
|
|
|
|
Expected asset return
|
7.50
|
%
|
|
7.75
|
%
|
|
8.75
|
%
|
|
7.50
|
%
|
|
7.75
|
%
|
|
8.75
|
%
|
|
Compensation increase
|
3.25/3.50%
|
|
(1)
|
3.25/3.50%
|
|
(1)
|
3.25/3.50%
|
|
|
3.25/3.50%
|
|
(1)
|
3.25/3.50%
|
|
|
3.50
|
%
|
|
Obligations:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Discount rate
|
4.36/4.35%
|
|
|
4.03
|
%
|
(1)
|
3.96/3.94%
|
|
|
4.38/4.37%
|
|
(1)
|
4.12/4.08%
|
|
(1)
|
4.08/4.01%
|
|
(1)
|
Compensation increase
|
3.25/3.50%
|
|
(1)
|
3.25/3.50%
|
|
(1)
|
3.25/3.50%
|
|
(1)
|
3.25/3.50%
|
|
(1)
|
3.25/3.50%
|
|
|
3.50
|
%
|
|
(1)
|
Percentages for represented and nonrepresented plans, respectively.
|
($ in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
HCCTR
|
7.9
|
%
|
|
8.3
|
%
|
|
8.5
|
%
|
|||
Ultimate HCCTR
|
4.5
|
%
|
|
4.5
|
%
|
|
4.5
|
%
|
|||
Year ultimate HCCTR reached
|
2024
|
|
|
2025
|
|
|
2025
|
|
|||
Effect of a 1 percentage point increase in the HCCTR on:
|
|
|
|
|
|
||||||
Year-end benefit obligation
|
$
|
36,260
|
|
|
$
|
32,019
|
|
|
$
|
28,803
|
|
Total service and interest cost
|
$
|
2,482
|
|
|
$
|
2,468
|
|
|
$
|
2,331
|
|
Effect of a 1 percentage point decrease in the HCCTR on:
|
|
|
|
|
|
||||||
Year-end benefit obligation
|
$
|
(28,743
|
)
|
|
$
|
(25,466
|
)
|
|
$
|
(22,862
|
)
|
Total service and interest costs
|
$
|
(1,937
|
)
|
|
$
|
(1,909
|
)
|
|
$
|
(1,801
|
)
|
|
2019
|
Assets at
|
|||||||
|
Target
|
September 30,
|
|||||||
Asset Allocation
|
Allocation
|
2018
|
|
|
2017
|
|
|
||
U.S. equity securities
|
34
|
%
|
|
41
|
%
|
|
39
|
%
|
|
International equity securities
|
17
|
|
|
19
|
|
|
21
|
|
|
Fixed income
|
41
|
|
|
37
|
|
|
40
|
|
|
Other assets
|
8
|
|
|
3
|
|
|
—
|
|
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
(Thousands)
|
Pension
|
OPEB
|
||||
2019
|
$
|
10,320
|
|
$
|
5,450
|
|
2020
|
$
|
11,769
|
|
$
|
6,512
|
|
2021
|
$
|
12,399
|
|
$
|
7,096
|
|
2022
|
$
|
13,239
|
|
$
|
7,810
|
|
2023
|
$
|
14,217
|
|
$
|
8,413
|
|
2024 - 2028
|
$
|
85,426
|
|
$
|
50,869
|
|
|
Estimated Subsidy
|
|||
(Thousands)
|
Payment
|
|||
2019
|
|
$
|
280
|
|
2020
|
|
$
|
316
|
|
2021
|
|
$
|
347
|
|
2022
|
|
$
|
375
|
|
2023
|
|
$
|
417
|
|
2024 - 2028
|
|
$
|
2,787
|
|
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
||||||||||||||
(Thousands)
|
Pension
|
|
OPEB
|
||||||||||||
Assets
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Money market funds
|
$
|
8,207
|
|
|
$
|
—
|
|
|
$
|
2,273
|
|
|
$
|
11
|
|
Registered Investment Companies:
|
|
|
|
|
|
|
|
||||||||
Equity Funds:
|
|
|
|
|
|
|
|
||||||||
Large Cap Index
|
97,016
|
|
|
88,321
|
|
|
27,340
|
|
|
23,986
|
|
||||
Extended Market Index
|
17,741
|
|
|
16,329
|
|
|
5,014
|
|
|
4,409
|
|
||||
International Stock
|
53,516
|
|
|
56,446
|
|
|
14,874
|
|
|
15,000
|
|
||||
Fixed Income Funds:
|
|
|
|
|
|
|
|
||||||||
Emerging Markets
|
11,754
|
|
|
13,516
|
|
|
3,264
|
|
|
3,551
|
|
||||
Core Fixed Income
|
—
|
|
|
—
|
|
|
7,970
|
|
|
8,082
|
|
||||
Opportunistic Income
|
—
|
|
|
—
|
|
|
4,798
|
|
|
4,744
|
|
||||
Ultra Short Duration
|
—
|
|
|
—
|
|
|
4,830
|
|
|
4,673
|
|
||||
High Yield Bond Fund
|
25,720
|
|
|
26,540
|
|
|
7,236
|
|
|
7,078
|
|
||||
Long Duration Fund
|
64,039
|
|
|
70,591
|
|
|
—
|
|
|
—
|
|
||||
Total assets
|
$
|
277,993
|
|
|
$
|
271,743
|
|
|
$
|
77,599
|
|
|
$
|
71,534
|
|
(Thousands)
|
2018
|
|
2017
|
||||||||||
|
NJNG
|
NJRCEV
|
|
NJNG
|
NJRCEV
|
||||||||
Balance at October 1
|
$
|
24,825
|
|
$
|
6,595
|
|
|
$
|
23,521
|
|
$
|
4,858
|
|
Accretion
|
1,366
|
|
198
|
|
|
1,304
|
|
245
|
|
||||
Additions
|
1,880
|
|
517
|
|
|
729
|
|
1,492
|
|
||||
Revisions in estimated cash flows
|
(2,133
|
)
|
—
|
|
|
(245
|
)
|
—
|
|
||||
Retirements
|
(298
|
)
|
—
|
|
|
(484
|
)
|
—
|
|
||||
Reclassification to held for sale or sold
|
—
|
|
(4,262
|
)
|
|
—
|
|
—
|
|
||||
Balance at period end
|
$
|
25,640
|
|
$
|
3,048
|
|
|
$
|
24,825
|
|
$
|
6,595
|
|
|
Estimated
|
||
(Thousands)
|
Accretion
|
||
2019
|
$
|
1,557
|
|
2020
|
1,627
|
|
|
2021
|
1,702
|
|
|
2022
|
1,778
|
|
|
2023
|
1,863
|
|
|
Total
|
$
|
8,527
|
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Current:
|
|
|
|
||||||
Federal
|
$
|
(2,848
|
)
|
$
|
(16,023
|
)
|
$
|
(23,597
|
)
|
State
|
4,563
|
|
2,470
|
|
(2,209
|
)
|
|||
Deferred:
|
|
|
|
||||||
Federal
|
(40,785
|
)
|
54,965
|
|
70,386
|
|
|||
State
|
6,731
|
|
11,457
|
|
11,441
|
|
|||
Investment/production tax credits
|
(21,446
|
)
|
(34,526
|
)
|
(32,491
|
)
|
|||
Income tax (benefit) provision
|
$
|
(53,785
|
)
|
$
|
18,343
|
|
$
|
23,530
|
|
(Thousands)
|
2018
|
|
2017
|
||||
Deferred tax assets
|
|
|
|
||||
Investment tax credits
(1)
|
$
|
123,258
|
|
|
$
|
111,642
|
|
Deferred service contract revenue
|
—
|
|
|
3,877
|
|
||
Incentive compensation
|
4,646
|
|
|
6,260
|
|
||
Fair value of derivatives
|
8,411
|
|
|
11,519
|
|
||
Federal net operating losses
(2)
|
24,500
|
|
|
28,487
|
|
||
State net operating losses
|
34,754
|
|
|
23,597
|
|
||
Amortization of intangibles
|
3,737
|
|
|
2,747
|
|
||
Conservation incentive plan
|
1,955
|
|
|
—
|
|
||
Other
|
8,213
|
|
|
11,098
|
|
||
Total deferred tax assets
|
$
|
209,474
|
|
|
$
|
199,227
|
|
Deferred tax liabilities
|
|
|
|
||||
Property related items
|
$
|
(392,886
|
)
|
|
$
|
(620,850
|
)
|
Remediation costs
|
(9,229
|
)
|
|
(11,625
|
)
|
||
Equity investments
|
(31,956
|
)
|
|
(38,370
|
)
|
||
Postemployment benefits
|
(353
|
)
|
|
(6,855
|
)
|
||
Conservation incentive plan
|
—
|
|
|
(7,195
|
)
|
||
Underrecovered gas costs
|
(1,156
|
)
|
|
(4,035
|
)
|
||
Other
|
(7,826
|
)
|
|
(16,643
|
)
|
||
Total deferred tax liabilities
|
$
|
(443,406
|
)
|
|
$
|
(705,573
|
)
|
|
|
|
|
||||
Total net deferred tax liabilities
|
$
|
(233,932
|
)
|
|
$
|
(506,346
|
)
|
(1)
|
Includes
$2.2 million
and
$2.3 million
for NJNG for
fiscal 2018
and
2017
, respectively
, which is being amortized over the life of the related assets, and
$121.1 million
and
$109.3 million
for Clean Energy Ventures for
fiscal 2018
and
2017
, respectively
, which is ITC carryforward.
|
(2)
|
See discussion of federal net operating loss utilization in the
Other Tax Items
section of this note.
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Statutory income tax expense
|
$
|
44,014
|
|
$
|
52,643
|
|
$
|
54,321
|
|
Change resulting from:
|
|
|
|
||||||
Tax Act - nonutility excess deferred income taxes
(1)
|
(59,627
|
)
|
—
|
|
—
|
|
|||
Tax Act - utility excess deferred income taxes refunded to customers
(1)
|
(14,323
|
)
|
—
|
|
—
|
|
|||
Tax Act - utility excess deferred income taxes amortized
(1)
|
(1,786
|
)
|
—
|
|
—
|
|
|||
State income taxes, net of federal benefit
|
7,092
|
|
8,222
|
|
6,044
|
|
|||
Cost of removal of assets placed in service prior to1981
|
(5,829
|
)
|
(6,886
|
)
|
(5,738
|
)
|
|||
Investment/production tax credits
|
(21,446
|
)
|
(34,526
|
)
|
(32,491
|
)
|
|||
Basis adjustment of solar assets due to ITC
|
1,080
|
|
4,256
|
|
4,453
|
|
|||
AFUDC equity
|
(2,117
|
)
|
(2,624
|
)
|
(1,531
|
)
|
|||
Other
|
(843
|
)
|
(2,742
|
)
|
(1,528
|
)
|
|||
Income tax (benefit) provision
|
$
|
(53,785
|
)
|
$
|
18,343
|
|
$
|
23,530
|
|
Effective income tax rate
(2) (3)
|
(29.9
|
)%
|
12.2
|
%
|
15.2
|
%
|
(1)
|
For a more detailed description, see
The Tax Act
section of this note.
|
(2)
|
The U.S. federal statutory rate was
24.5 percent
for fiscal 2018 and
35 percent
for fiscal 2017 and 2016.
|
(3)
|
The effective tax rate without the impact of the Tax Act would have been
12.4 percent
for fiscal 2018.
|
(Thousands)
|
2018
|
||
Income tax (benefit) provision
|
|
||
Clean Energy Ventures
|
$
|
(61,423
|
)
|
Energy Services
|
6,062
|
|
|
Midstream
|
(13,946
|
)
|
|
Home Services and Other
|
9,680
|
|
|
Total
|
$
|
(59,627
|
)
|
(Thousands)
|
2019
|
2020
|
2021
|
2022
|
2023
|
Thereafter
|
||||||||||||
Energy Services:
|
|
|
|
|
|
|
||||||||||||
Natural gas purchases
|
$
|
428,015
|
|
$
|
28,389
|
|
$
|
10,965
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
Storage demand fees
|
31,716
|
|
19,926
|
|
13,478
|
|
8,904
|
|
4,212
|
|
991
|
|
||||||
Pipeline demand fees
|
52,148
|
|
49,790
|
|
28,209
|
|
24,153
|
|
18,988
|
|
5,151
|
|
||||||
Sub-total Energy Services
|
$
|
511,879
|
|
$
|
98,105
|
|
$
|
52,652
|
|
$
|
33,057
|
|
$
|
23,200
|
|
$
|
6,142
|
|
NJNG:
|
|
|
|
|
|
|
||||||||||||
Natural gas purchases
|
$
|
65,737
|
|
$
|
37,727
|
|
$
|
33,738
|
|
$
|
33,546
|
|
$
|
34,221
|
|
$
|
35,762
|
|
Storage demand fees
|
31,384
|
|
24,263
|
|
14,251
|
|
12,930
|
|
7,899
|
|
6,066
|
|
||||||
Pipeline demand fees
|
80,609
|
|
96,241
|
|
89,236
|
|
91,946
|
|
87,240
|
|
586,266
|
|
||||||
Sub-total NJNG
|
$
|
177,730
|
|
$
|
158,231
|
|
$
|
137,225
|
|
$
|
138,422
|
|
$
|
129,360
|
|
$
|
628,094
|
|
Total
|
$
|
689,609
|
|
$
|
256,336
|
|
$
|
189,877
|
|
$
|
171,479
|
|
$
|
152,560
|
|
$
|
634,236
|
|
(1)
|
Includes sales to Canada, which are immaterial.
|
(2)
|
The amortization of acquired wholesale energy contracts is excluded above and is included in gas purchases - nonutility on the Unaudited Condensed Consolidated Statements of Operations.
|
(3)
|
Included in other income, net on the Consolidated Statements of Operations.
|
(Thousands)
|
|
|
|
||||||
Fiscal Years Ended September 30,
|
2018
|
2017
|
2016
|
||||||
Interest expense, net of capitalized interest
|
|
|
|
||||||
Natural Gas Distribution
|
$
|
25,299
|
|
$
|
25,818
|
|
$
|
19,930
|
|
Clean Energy Ventures
|
18,320
|
|
16,263
|
|
10,304
|
|
|||
Energy Services
|
3,945
|
|
2,747
|
|
1,095
|
|
|||
Midstream
|
1,667
|
|
960
|
|
287
|
|
|||
Subtotal
|
49,231
|
|
45,788
|
|
31,616
|
|
|||
Home Services and Other
|
7
|
|
410
|
|
252
|
|
|||
Eliminations
|
(2,952
|
)
|
(1,312
|
)
|
(824
|
)
|
|||
Total
|
$
|
46,286
|
|
$
|
44,886
|
|
$
|
31,044
|
|
Income tax (benefit) provision
|
|
|
|
||||||
Natural Gas Distribution
|
$
|
(1,910
|
)
|
$
|
43,485
|
|
$
|
34,951
|
|
Clean Energy Ventures
|
(79,932
|
)
|
(31,161
|
)
|
(26,592
|
)
|
|||
Energy Services
|
24,996
|
|
(4,015
|
)
|
7,030
|
|
|||
Midstream
|
(8,548
|
)
|
5,820
|
|
6,130
|
|
|||
Subtotal
|
(65,394
|
)
|
14,129
|
|
21,519
|
|
|||
Home Services and Other
|
11,944
|
|
3,857
|
|
1,387
|
|
|||
Eliminations
|
(335
|
)
|
357
|
|
624
|
|
|||
Total
|
$
|
(53,785
|
)
|
$
|
18,343
|
|
$
|
23,530
|
|
Equity in earnings of affiliates
|
|
|
|
||||||
Midstream
|
$
|
16,165
|
|
$
|
17,797
|
|
$
|
13,936
|
|
Eliminations
|
(3,157
|
)
|
(3,984
|
)
|
(4,421
|
)
|
|||
Total
|
$
|
13,008
|
|
$
|
13,813
|
|
$
|
9,515
|
|
Net financial earnings (loss)
|
|
|
|
||||||
Natural Gas Distribution
|
$
|
84,048
|
|
$
|
86,930
|
|
$
|
76,104
|
|
Clean Energy Ventures
|
75,849
|
|
24,873
|
|
28,393
|
|
|||
Energy Services
|
60,378
|
|
18,554
|
|
21,934
|
|
|||
Midstream
|
24,367
|
|
12,857
|
|
9,406
|
|
|||
Subtotal
|
244,642
|
|
143,214
|
|
135,837
|
|
|||
Home Services and Other
|
(3,829
|
)
|
6,811
|
|
2,882
|
|
|||
Eliminations
|
(327
|
)
|
(633
|
)
|
(634
|
)
|
|||
Total
|
$
|
240,486
|
|
$
|
149,392
|
|
$
|
138,085
|
|
Capital expenditures
|
|
|
|
||||||
Natural Gas Distribution
|
$
|
254,523
|
|
$
|
176,249
|
|
$
|
205,133
|
|
Clean Energy Ventures
|
123,421
|
|
149,400
|
|
149,063
|
|
|||
Midstream
|
5,431
|
|
—
|
|
—
|
|
|||
Subtotal
|
383,375
|
|
325,649
|
|
354,196
|
|
|||
Home Services and Other
|
1,213
|
|
2,434
|
|
1,896
|
|
|||
Total
|
$
|
384,588
|
|
$
|
328,083
|
|
$
|
356,092
|
|
Investments in equity investees
|
|
|
|
||||||
Midstream
|
16,151
|
|
27,070
|
|
11,176
|
|
|||
Total
|
$
|
16,151
|
|
$
|
27,070
|
|
$
|
11,176
|
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Consolidated net financial earnings
|
$
|
240,486
|
|
$
|
149,392
|
|
$
|
138,085
|
|
Less:
|
|
|
|
||||||
Unrealized loss (gain) on derivative instruments and related transactions
|
26,770
|
|
(11,241
|
)
|
46,883
|
|
|||
Tax effect
|
(4,512
|
)
|
4,062
|
|
(17,018
|
)
|
|||
Effects of economic hedging related to natural gas inventory
|
(22,570
|
)
|
38,470
|
|
(36,816
|
)
|
|||
Tax effect
|
7,362
|
|
(13,964
|
)
|
13,364
|
|
|||
Consolidated net income
|
$
|
233,436
|
|
$
|
132,065
|
|
$
|
131,672
|
|
•
|
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)
|
2018
|
2017
|
2016
|
||||||
Assets at end of period:
|
|
|
|
||||||
Natural Gas Distribution
|
$
|
2,663,054
|
|
$
|
2,519,578
|
|
$
|
2,517,401
|
|
Clean Energy Ventures
(1)
|
865,018
|
|
771,340
|
|
665,696
|
|
|||
Energy Services
|
396,852
|
|
398,277
|
|
327,626
|
|
|||
Midstream
|
242,069
|
|
232,806
|
|
186,259
|
|
|||
Subtotal
|
4,166,993
|
|
3,922,001
|
|
3,696,982
|
|
|||
Home Services and Other
|
114,732
|
|
114,801
|
|
109,487
|
|
|||
Intercompany assets
(2)
|
(138,061
|
)
|
(108,295
|
)
|
(87,899
|
)
|
|||
Total
|
$
|
4,143,664
|
|
$
|
3,928,507
|
|
$
|
3,718,570
|
|
(1)
|
Includes assets held for sale of
$206.9 million
for
September 30, 2018
.
|
(2)
|
Consists of transactions between subsidiaries that are eliminated and reclassified in consolidation.
|
(Thousands)
|
2018
|
2017
|
2016
|
||||||
Natural Gas Distribution
|
$
|
5,730
|
|
$
|
5,590
|
|
$
|
5,562
|
|
Energy Services
|
2,775
|
|
2,750
|
|
2,789
|
|
|||
Total
|
$
|
8,505
|
|
$
|
8,340
|
|
$
|
8,351
|
|
(Thousands)
|
2018
|
2017
|
||||
Natural Gas Distribution
|
$
|
775
|
|
$
|
775
|
|
Energy Services
|
375
|
|
377
|
|
||
Total
|
$
|
1,150
|
|
$
|
1,152
|
|
|
First
|
Second
|
Third
|
Fourth
|
||||||||
(Thousands, except per share data)
|
Quarter
|
Quarter
|
Quarter
|
Quarter
|
||||||||
2018
|
|
|
|
|
||||||||
Operating revenues
|
$
|
705,305
|
|
$
|
1,019,043
|
|
$
|
543,435
|
|
$
|
647,326
|
|
Operating income (loss)
|
$
|
75,245
|
|
$
|
177,792
|
|
$
|
(37,666
|
)
|
$
|
(19,295
|
)
|
Net income (loss)
|
$
|
123,699
|
|
$
|
140,266
|
|
$
|
(14,274
|
)
|
$
|
(16,255
|
)
|
Earnings (loss) per share
(1)
|
|
|
|
|
||||||||
Basic
|
$1.42
|
$1.60
|
$(0.16)
|
$(0.18)
|
||||||||
Diluted
|
$1.42
|
$1.59
|
$(0.16)
|
$(0.18)
|
||||||||
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)
|
(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
|
132
.
|
|
|
|
Page
|
|
Schedule II - Valuation and qualifying accounts and reserves for each of the three years in the period ended September 30, 2018
|
(Thousands)
|
|
ADDITIONS
|
|
|
||||||
CLASSIFICATION
|
BEGINNING
BALANCE
|
CHARGED TO
EXPENSE
|
OTHER
(1)
|
ENDING BALANCE
|
||||||
2018
|
|
|
|
|
||||||
Allowance for doubtful accounts
|
$
|
5,181
|
|
2,579
|
|
(2,056
|
)
|
$
|
5,704
|
|
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
|
|
(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 July 10, 2018 (
incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K, as filed on July 16, 2018
)
|
|
|
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 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
)
|
|
|
Exhibit
Number
|
Exhibit Description
|
|
|
4.8
|
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
)
|
|
|
4.9
|
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
)
|
|
|
4.10
|
$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
)
|
|
|
4.11
|
$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
)
|
|
|
4.12
|
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
)
|
|
|
4.13
|
$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
)
|
|
|
4.15
|
$125,000,000 Note Purchase Agreement, dated as of May 11, 2018, 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 May 11, 2018
)
|
|
|
4.16
|
Third Supplemental Indenture, dated as of May 1, 2018, by and between New Jersey Natural Gas Company and U.S. Bank National Association (incorporated by reference to
Exhibit 4.2 to the Current Report on Form 8-K, as filed on May 11, 2018
)
|
|
|
4.17
|
$100,000,000 Note Purchase Agreement, dated as of June 8, 2018, by and among New Jersey Resources Corporation and the Purchasers party thereto (incorporated by reference to
Exhibit 4.1 to the Current Report on Form 8-K, as filed on June 8, 2018
)
|
|
|
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
)
|
|
|
10.5*
|
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 19, 2018
)
|
|
|
10.6*
|
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
)
|
Exhibit
Number
|
Exhibit Description
|
|
|
10.7*
|
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
)
|
|
|
10.8*
|
New Jersey Resources Corporation 2017 Stock Award and Incentive Plan Performance Share Units Agreement - Total Shareholder Return (incorporated by reference to
Exhibit 10.8 to the Quarterly Report on Form 10-Q, as filed on February 8, 2018
)
|
|
|
10.9*
|
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
)
|
|
|
10.10*
|
New Jersey Resources Corporation 2017 Stock Award and Incentive Plan Performance Share Units Agreement - NFE (incorporated by reference to
Exhibit 10.6 to the Quarterly Report on Form 10-Q, as filed on February 8, 2018
)
|
|
|
10.11*
|
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
)
|
|
|
10.12*
|
New Jersey Resources Corporation 2017 Stock Award and Incentive Plan Performance Based Restricted Stock Units Agreement (incorporated by reference to
Exhibit 10.10 to the Quarterly Report on Form 10-Q, as filed on February 8, 2018
)
|
|
|
10.13*
|
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
)
|
|
|
10.14*
|
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
)
|
|
|
10.15*
|
New Jersey Resources Corporation Deferred Stock Retention Award Agreement (incorporated by reference to
Exhibit 10.7 to the Quarterly Report on Form 10-Q, as filed on February 8, 2018
)
|
|
|
10.16*
|
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
)
|
|
|
10.17*
|
New Jersey Resources Corporation 2017 Stock Award and Incentive Plan Restricted Stock Units Agreement (incorporated by reference to
Exhibit 10.9 to the Quarterly Report on Form 10-Q, as filed on February 8, 2018
)
|
|
|
10.18*
|
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
)
|
|
|
10.19*
|
New Jersey Resources Corporation Savings Equalization Plan (as amended and restated as of January 1, 2017) (incorporated by reference to
Exhibit 10.21 to the Annual Report on Form 10-K as filed on November 21, 2017
)
|
|
|
10.20*
|
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
)
|
|
|
10.21*
|
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
)
|
|
|
10.22*
|
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
)
|
|
|
10.23*
|
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
)
|
|
|
10.24*
|
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
)
|
|
|
10.24(a)*+
|
|
|
|
10.25
|
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
)
|
|
|
Exhibit
Number
|
Exhibit Description
|
|
|
10.26
|
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
)
|
|
|
10.27
|
First Amendment to Amended and Restated Credit Agreement, dated as of June 25, 2018, by and among New Jersey Resources Corporation and the Guarantors party thereto, the Lenders party thereto and PNC Bank, National Association, in its capacity as administrative agent for the Lenders (incorporated by reference to
Exhibit 10.1 to the Current Report on Form 8-K, as filed on June 26, 2018
)
|
|
|
10.28
|
First Amendment to Amended and Restated Credit Agreement, dated as of July 17, 2018, by and among New Jersey Resources Corporation and the guarantors party thereto, the lenders party thereto and U.S. Bank National Association, in its capacity as administrative agent for the lenders (incorporated by reference to
Exhibit 10.1 to the Current Report on Form 8-K, as filed on July 19, 2018
)
|
|
|
21.1+
|
|
|
|
23.1+
|
|
|
|
31.1+
|
|
|
|
31.2+
|
|
|
|
32.1+ †
|
|
|
|
32.2+ †
|
|
|
|
99.1
|
Form of Letter to Shareowners Regarding Transfer Agent Change August 17, 2018 (incorporated by reference to
Exhibit 99.1 to the Current Report on Form 8-K, as filed on August 17, 2018
)
|
|
|
101+
|
Interactive Data File {Annual Report on Form 10-K, for the fiscal year ended September 30, 2018, 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 20, 2018
|
By:/s/ Patrick Migliaccio
|
|
|
Patrick Migliaccio
|
|
|
Senior Vice President and
|
|
|
Chief Financial Officer
|
November 20, 2018
|
/s/ Laurence M. Downes
|
November 20, 2018
|
/s/ Patrick J. Migliaccio
|
|
Laurence M. Downes
Chairman and
Chief Executive Officer
Director
(Principal Executive Officer)
|
|
Patrick J. Migliaccio
Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer) |
|
|
|
|
November 20, 2018
|
/s/ Maureen A. Borkowski
|
November 20, 2018
|
/s/ J. Terry Strange
|
|
Maureen A. Borkowski
Director
|
|
J. Terry Strange
Director |
|
|
|
|
November 20, 2018
|
/s/ Donald L. Correll
|
November 20, 2018
|
/s/ Sharon C. Taylor
|
|
Donald L. Correll
Director |
|
Sharon C. Taylor
Director |
|
|
|
|
November 20, 2018
|
/s/ Robert B. Evans
|
November 20, 2018
|
/s/ David A. Trice
|
|
Robert B. Evans
Director |
|
David A. Trice
Director |
|
|
|
|
November 20, 2018
|
/s/ M. William Howard, Jr.
|
November 20, 2018
|
/s/ Stephen D. Westhoven
|
|
M. William Howard, Jr.
Director |
|
Stephen D. Westhoven
President and Chief Operating Officer
Director |
|
|
|
|
November 20, 2018
|
/s/ Jane M. Kenny
|
November 20, 2018
|
/s/ George R. Zoffinger
|
|
Jane M. Kenny
Director |
|
George R. Zoffinger
Director |
|
|
|
|
November 20, 2018
|
/s/ Thomas C. O’Connor
|
|
|
|
Thomas C. O’Connor
Director |
|
|
Name
|
Termination Benefit
|
Laurence M. Downes, President and Chief Executive Officer
|
Three times
the sum, of (x) his then annual base salary and (y) the average of his annual bonuses paid or payable with respect to the last three calendar years ended prior to the Change of Control.
|
Stephen D. Westhoven, President and Chief Operating Officer
|
Two times
the sum, of (x) his then annual base salary and (y) the average of his annual bonuses paid or payable with respect to the last three calendar years ended prior to the Change of Control (“
2x
”).
|
Patrick J. Migliaccio, Senior Vice President and Chief Financial Officer
|
2x
|
Amanda Mullan, Senior Vice President and Chief Human Resources Officer
|
2x
|
Nancy A. Washington, Senior Vice President and General Counsel
|
2x
|
SUBSIDIARY
|
|
|
|
|
STATE OF INCORPORATION
|
||||
|
|
|
|
|
|
|
|
|
|
New Jersey Natural Gas Company
|
|
New Jersey
|
|
||||||
|
|
|
|
|
|
|
|
|
|
NJR Service Corporation
|
|
New Jersey
|
|
||||||
|
|
|
|
|
|
|
|
|
|
NJR Energy Services Company
|
|
New Jersey
|
|
||||||
|
|
|
|
|
|
|
|
|
|
NJR Clean Energy Ventures Corporation
|
|
New Jersey
|
|
||||||
|
Subsidiary:
|
|
|
|
|
|
|
|
|
|
NJR Clean Energy Ventures II Corporation
|
|
New Jersey
|
|
|||||
|
|
Subsidiaries:
|
|
|
|
|
|
||
|
|
Carroll Area Wind Farm, LLC (Limited Liability Company)
|
|
Iowa
|
|
||||
|
|
Alexander Wind Farm, LLC (Limited Liability Company)
|
|
Delaware
|
|
||||
|
|
Ringer Hill Wind, LLC (Limited Liability Company)
|
|
Delaware
|
|
||||
|
|
Bernards Solar, LLC (Limited Liability Company)
|
|
New Jersey
|
|
||||
|
|
Medicine Bow Wind, LLC (Limited Liability Company)
|
|
Delaware
|
|
||||
|
|
NJR Clean Energy Ventures III Corporation
|
|
New Jersey
|
|
||||
|
|
|
|
|
|
|
|
|
|
NJR Energy Investments Corporation
|
|
New Jersey
|
|
||||||
|
Subsidiaries:
|
|
|
|
|
|
|
|
|
|
NJR Midstream Holdings Corporation
|
|
New Jersey
|
|
|||||
|
|
Subsidiaries:
|
|
|
|
|
|
||
|
|
NJNR Pipeline Company
|
|
New Jersey
|
|
||||
|
|
NJR Pipeline Company
|
|
New Jersey
|
|
||||
|
|
|
Subsidiary:
|
|
|
|
|
||
|
|
|
Adelphia Gateway, LLC (Limited Liability Company)
|
|
Delaware
|
|
|||
|
|
NJR Storage Holdings Company
|
|
Delaware
|
|
||||
|
|
|
Subsidiary:
|
|
|
|
|
||
|
|
|
NJR Steckman Ridge Storage Company
|
|
Delaware
|
|
|||
|
|
|
|
|
|
|
|
|
|
NJR Retail Holdings Corporation
|
|
New Jersey
|
|
||||||
|
Subsidiaries:
|
|
|
|
|
|
|
|
|
|
Commercial Realty and Resources Corporation
|
|
New Jersey
|
|
|||||
|
Phoenix Fuel Management Company
|
|
New Jersey
|
|
|||||
|
NJR Home Services Company
|
|
New Jersey
|
|
|||||
|
|
Subsidiary:
|
|
|
|
|
|
||
|
|
NJR Plumbing Services, Inc
|
|
New Jersey
|
|
1)
|
I have reviewed this report on Form
10-K
of New Jersey Resources Corporation;
|
2)
|
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;
|
3)
|
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;
|
4)
|
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:
|
a)
|
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;
|
b)
|
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;
|
c)
|
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
|
d)
|
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
|
5)
|
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):
|
a)
|
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
|
b)
|
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.
|
Date:
|
November 20, 2018
|
By:
|
/s/ Laurence M. Downes
|
|
|
|
Laurence M. Downes
|
|
|
|
Chairman & Chief Executive Officer
|
1)
|
I have reviewed this report on Form
10-K
of New Jersey Resources Corporation;
|
2)
|
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;
|
3)
|
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;
|
4)
|
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:
|
a)
|
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;
|
b)
|
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;
|
c)
|
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
|
d)
|
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
|
5)
|
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):
|
a)
|
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
|
b)
|
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.
|
Date:
|
November 20, 2018
|
By:
|
/s/ Patrick Migliaccio
|
|
|
|
Patrick Migliaccio
|
|
|
|
Senior Vice President and Chief Financial Officer
|
(a)
|
I am the Chief Executive Officer of New Jersey Resources Corporation (the "Company");
|
(b)
|
To the best of my knowledge, this
annual
report on Form
10-K
for the fiscal
year
ended
September 30, 2018
, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(c)
|
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:
|
November 20, 2018
|
By:
|
/s/ Laurence M. Downes
|
|
|
|
Laurence M. Downes
|
|
|
|
Chairman and Chief Executive Officer
|
(a)
|
I am the Chief
Financial
Officer of New Jersey Resources Corporation (the "Company");
|
(b)
|
To the best of my knowledge, this
annual
report on Form
10-K
for the fiscal
year
ended
September 30, 2018
, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(c)
|
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:
|
November 20, 2018
|
By:
|
/s/ Patrick Migliaccio
|
|
|
|
Patrick Migliaccio
|
|
|
|
Senior Vice President and Chief Financial Officer
|