Exhibit 99
| 6363 Main Street/Williamsville, NY 14221 | |||||||||||
| Release Date: | Immediate November 4, 2021 | Brandon J. Haspett Investor Relations 716-857-7697 | Karen M. Camiolo Treasurer 716-857-7344 | ||||||||
NATIONAL FUEL REPORTS FOURTH QUARTER
AND FULL YEAR FISCAL 2021 EARNINGS
WILLIAMSVILLE, N.Y.: National Fuel Gas Company (“National Fuel” or the “Company”) (NYSE:NFG) today announced consolidated results for the three months and fiscal year ended September 30, 2021.
FISCAL 2021 FOURTH QUARTER SUMMARY
•GAAP net income of $87.0 million, or $0.95 per share, compared to GAAP net loss of $145.5 million, or $1.60 per share, in the prior year.
•Adjusted operating results of $87.3 million, or $0.95 per share, an increase of 138%, compared to $0.40 per share in the prior year (see non-GAAP reconciliation on page 2).
•Adjusted EBITDA of $215.9 million, an increase of 35%, compared to $159.6 million in the prior year (see non-GAAP reconciliation on page 25).
•E&P segment Adjusted EBITDA of $120.6 million, an increase of 60% from the prior year.
•E&P segment net production of 79.6 Bcfe, an increase of 12.3 Bcfe, or 18%, from the prior year.
•Gathering segment Adjusted EBITDA of $37.9 million, an increase of 15% from the prior year.
•Pipeline & Storage segment Adjusted EBITDA of $49.1 million, an increase of 5% from the prior year.
FISCAL 2021 HIGHLIGHTS
•GAAP net income of $363.6 million, or $3.97 per share, compared to GAAP net loss of $123.8 million, or $1.41 per share, in the prior year.
•Adjusted operating results of $393.1 million, or $4.29 per share, an increase of 47%, compared to $2.92 per share in the prior year (see non-GAAP reconciliation on page 2).
•Successfully integrated the Company's fiscal 2020 Appalachian acquisition, with E&P segment net production of 327.4 Bcfe, an increase of 85.9 Bcfe, or 36%, from the prior year, and a corresponding 38% increase in Gathering segment throughput.
•Reduced E&P segment cash operating costs (combined G&A expense, LOE expense, other operation and maintenance expense, and property, franchise, and other taxes) to $1.14 per Mcfe, a decrease of approximately $0.09 per Mcfe, or 7%, from the prior year.
•Continued growth of Pipeline & Storage segment, with revenues of $343.6 million, an increase of $34.0 million, or 11%, from the prior year, driven largely by the Company's Empire North expansion project.
•Invested $79.7 million in Utility system modernization and reliability, replacing over 150 miles of older vintage mains and services, and bringing 5-year total to over $358 million.
•Increased shareholder dividend for the 51st consecutive year to an annual rate of $1.82 per share.
•Published second annual Corporate Responsibility Report in September 2021, which includes additional climate-related information under the Task Force on Climate-Related Financial Disclosures framework, enhanced disclosure of scope 1 and scope 2 emissions, and methane intensity and greenhouse gas emission reduction targets.
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MANAGEMENT COMMENTS
David P. Bauer, President and Chief Executive Officer of National Fuel Gas Company, stated: “National Fuel closed out an excellent fiscal 2021, with a 47% increase in our adjusted operating results compared to last year. The successful integration of our fiscal 2020 Appalachian acquisition, continued growth of our FERC-regulated pipeline business, and higher commodity prices all contributed to the strong results and position National Fuel for success in the coming years.
“As we move into fiscal 2022, the expected December 1, 2021 in-service of our FM100 expansion and modernization project will drive further growth for National Fuel. Once complete, this project is expected to deliver approximately $50 million in incremental annual revenues for the Pipeline and Storage segment, and will provide desirable pipeline takeaway capacity to higher value Mid-Atlantic markets, allowing for further growth in both our Exploration and Production and Gathering segments.
“Overall, the FM100 Project serves as a key example of the value of our integrated business model. Coupled with the Company’s commitment to reducing our emissions footprint in all segments, as evidenced by our targets set out in our recently published Corporate Responsibility Report, we believe we can generate strong, sustainable returns in the years ahead and deliver long-term value for our shareholders.”
RECONCILIATION OF GAAP EARNINGS TO ADJUSTED OPERATING RESULTS
| Three Months Ended | Fiscal Year Ended | |||||||||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||||||||
| (in thousands except per share amounts) | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||
| Reported GAAP Earnings | $ | 86,962 | $ | (145,545) | $ | 363,647 | $ | (123,772) | ||||||||||||||||||
Items impacting comparability: | ||||||||||||||||||||||||||
Impairment of oil and gas properties (E&P) | — | 253,441 | 76,152 | 449,438 | ||||||||||||||||||||||
Tax impact of impairment of oil and gas properties | — | (69,698) | (20,980) | (123,187) | ||||||||||||||||||||||
| Gain on sale of timber properties (Corporate / All Other) | — | — | (51,066) | — | ||||||||||||||||||||||
| Tax impact of gain on sale of timber properties | — | — | 14,069 | — | ||||||||||||||||||||||
| Premium paid on early redemption of debt | — | — | 15,715 | — | ||||||||||||||||||||||
| Tax impact of premium paid on early redemption of debt | — | — | (4,321) | — | ||||||||||||||||||||||
| Deferred tax valuation allowance | — | — | — | 56,770 | ||||||||||||||||||||||
Unrealized (gain) loss on other investments (Corporate / All Other) | 395 | (2,439) | (181) | (1,645) | ||||||||||||||||||||||
Tax impact of unrealized (gain) loss on other investments | (83) | 512 | 38 | 345 | ||||||||||||||||||||||
| Adjusted Operating Results | $ | 87,274 | $ | 36,271 | $ | 393,073 | $ | 257,949 | ||||||||||||||||||
| Reported GAAP Earnings Per Share | $ | 0.95 | $ | (1.60) | $ | 3.97 | $ | (1.41) | ||||||||||||||||||
Items impacting comparability: | ||||||||||||||||||||||||||
Impairment of oil and gas properties, net of tax (E&P) | — | 2.02 | 0.60 | 3.71 | ||||||||||||||||||||||
| Gain on sale of timber properties, net of tax (Corporate / All Other) | — | — | (0.40) | — | ||||||||||||||||||||||
| Premium paid on early redemption of debt, net of tax | — | — | 0.12 | — | ||||||||||||||||||||||
| Deferred tax valuation allowance | — | — | — | 0.65 | ||||||||||||||||||||||
Unrealized (gain) loss on other investments, net of tax (Corporate / All Other) | — | (0.02) | — | (0.01) | ||||||||||||||||||||||
| Earnings per share impact of diluted shares | — | — | — | (0.02) | ||||||||||||||||||||||
| Adjusted Operating Results Per Share | $ | 0.95 | $ | 0.40 | $ | 4.29 | $ | 2.92 | ||||||||||||||||||
FISCAL 2022 GUIDANCE UPDATE
National Fuel is revising its fiscal 2022 earnings guidance to reflect updated forecast assumptions and projections, including the impact of increased natural gas price expectations since the Company’s preliminary guidance was announced in August 2021. The Company is now projecting that earnings will be within the range of $5.05 to $5.45 per share, an increase of 22% from the Company’s 2021 adjusted operating results at the midpoint of the updated guidance range.
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Due to the meaningful difference between current winter and summer NYMEX forward natural gas prices for fiscal 2022, the Company is revising its guidance to reflect projections for both the first half and second half of this fiscal year. The Company is now assuming that NYMEX natural gas prices will average $5.50 per MMBtu for the first six months of fiscal 2022 (October-March) and $3.75 per MMBtu for the second half of fiscal 2022 (April-September). Additionally, the Company is now assuming that WTI oil prices will average $75.00 per Bbl in fiscal 2022, a $10.00 increase from the $65.00 per Bbl assumed in the previous guidance. For guidance purposes, the Company’s updated projections approximate the current NYMEX forward markets for natural gas and oil and consider the impact of local sales point differentials and new physical firm sales, transportation, and financial hedge contracts.
Consistent with preliminary guidance, the Exploration and Production segment’s fiscal 2022 net production remains unchanged, which is expected to be in the range of 335 to 365 Bcfe. Seneca currently has firm sales contracts in place for approximately 93% of its projected fiscal 2022 Appalachian production, limiting its exposure to in-basin markets. Approximately 76% of Seneca’s expected Appalachian production is either matched by a financial hedge, including a combination of swaps and no-cost collars, or were entered into at a fixed price. The Company’s consolidated and individual segment capital expenditures guidance also remain unchanged from the preliminary guidance.
The Company's other guidance assumptions remain largely unchanged from the previous guidance. Additional details on the Company's updated forecast assumptions and business segment guidance for fiscal 2022 are outlined in the table on page 8.
DISCUSSION OF FOURTH QUARTER RESULTS BY SEGMENT
The following earnings discussion of each operating segment for the quarter ended September 30, 2021 is summarized in a tabular form on pages 9 and 10 of this report (earnings drivers for the fiscal year ended September 30, 2021 are summarized on pages 11 and 12). It may be helpful to refer to those tables while reviewing this discussion.
Note that management defines Adjusted Operating Results as reported GAAP earnings adjusted for items impacting comparability, and Adjusted EBITDA as reported GAAP earnings before the following items: interest expense, income taxes, depreciation, depletion and amortization, other income and deductions, impairments, and other items reflected in operating income that impact comparability.
Upstream Business
Exploration and Production Segment
The Exploration and Production segment operations are carried out by Seneca Resources Company, LLC ("Seneca"). Seneca explores for, develops and produces natural gas and oil reserves, primarily in Pennsylvania and California.
| Three Months Ended | |||||||||||||||||
| September 30, | |||||||||||||||||
| (in thousands) | 2021 | 2020 | Variance | ||||||||||||||
| GAAP Earnings | $ | 55,703 | $ | (169,171) | $ | 224,874 | |||||||||||
Impairment of oil and gas properties, net of tax | — | 183,743 | (183,743) | ||||||||||||||
| Adjusted Operating Results | $ | 55,703 | $ | 14,572 | $ | 41,131 | |||||||||||
| Adjusted EBITDA | $ | 120,588 | $ | 75,439 | $ | 45,149 | |||||||||||
Seneca’s fourth quarter GAAP earnings increased $224.9 million versus the prior year, primarily due to the prior-year fourth quarter impact of a non-cash ceiling test impairment charge of $183.7 million (after-tax). Excluding this item, Seneca’s fourth quarter earnings increased $41.1 million primarily due to higher natural gas production and higher realized natural gas and crude oil prices, as well as lower interest expense and a lower effective income tax rate, partially offset by higher operating expenses.
Seneca produced 79.6 Bcfe during the fourth quarter, an increase of 12.3 Bcfe, or 18%, from the prior year. The improvement was due to an increase in natural gas production, primarily due to the Company's fourth quarter fiscal 2020 Appalachian acquisition coupled with production growth from Seneca's other core development areas. Approximately 6.7 Bcf of the natural gas production increase came from the Eastern Development Area ("EDA"), while the remaining increase of
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5.6 Bcf was attributable to Seneca’s Western Development Area ("WDA"). Seneca's crude oil production in California decreased 4 MBbls, or 1%, versus the prior year.
Seneca's average realized natural gas price, after the impact of hedging and transportation costs, was $2.37 per Mcf, an increase of $0.45 per Mcf from the prior year. This increase was primarily due to higher NYMEX prices and higher spot prices at local sales points in Pennsylvania. Seneca's average realized oil price, after the impact of hedging, was $60.04 per Bbl, an increase of $4.34 per Bbl compared to the prior year. The improvement in oil price realizations was primarily due to stronger commodity pricing.
Lease operating and transportation (“LOE”) expense increased $13.0 million primarily due to higher transportation costs in Appalachia from increased production, as well as higher well repairs, workover activity and steam fuel costs in California. LOE expense includes $45.8 million in intercompany expense for gathering and compression services used to connect Seneca’s Appalachian production to sales points along interstate pipelines. DD&A expense increased $1.7 million due largely to higher natural gas production, partially offset by the impact of ceiling test impairments recorded during fiscal 2020. Other taxes increased $2.2 million primarily due to higher impact fee accruals in Pennsylvania, driven by higher expected NYMEX natural gas prices for calendar 2021.
Interest expense decreased $3.6 million due primarily to lower weighted average interest rates as a result of the Company's issuance of a 2.95% coupon 10-year note in February 2021, which replaced a 4.9% coupon 10-year note that was retired in March 2021. The reduction in Seneca's effective income tax rate was primarily driven by a decrease to a valuation allowance for deferred tax assets that was initially established in the second quarter of fiscal 2020, partially offset by a higher effective state income tax rate as a result of the Company's Appalachian acquisition that caused a change in the mix of earnings between state jurisdictions.
Proved Reserves Year-End Update
Seneca’s total proved natural gas and crude oil reserves at September 30, 2021 were 3,853 Bcfe, an increase of 395 Bcfe, or 11%, from September 30, 2020. Seneca’s proved developed reserves at the end of fiscal 2021 were 3,217 Bcfe, representing 84% of total proved reserves, which is consistent with the prior year. The proved reserves base is approximately 97% natural gas and 3% oil. In fiscal 2021, Seneca recorded 696 Bcfe of proved reserve extensions and discoveries, due primarily to Utica and Marcellus locations, and 27 Bcfe of net positive revisions due primarily to certain price-related revisions, improvements in well performance and changes in development plans. As a result, Seneca replaced 221% of its fiscal 2021 production.
Midstream Businesses
Pipeline and Storage Segment
The Pipeline and Storage segment’s operations are carried out by National Fuel Gas Supply Corporation (“Supply Corporation”) and Empire Pipeline, Inc. (“Empire”). The Pipeline and Storage segment provides natural gas transportation and storage services to affiliated and non-affiliated companies through an integrated system of pipelines and underground natural gas storage fields in western New York and Pennsylvania.
| Three Months Ended | |||||||||||||||||
| September 30, | |||||||||||||||||
| (in thousands) | 2021 | 2020 | Variance | ||||||||||||||
| GAAP Earnings | $ | 21,482 | $ | 16,045 | $ | 5,437 | |||||||||||
| Adjusted EBITDA | $ | 49,131 | $ | 46,966 | $ | 2,165 | |||||||||||
The Pipeline and Storage segment’s fourth quarter GAAP earnings increased $5.4 million versus the prior year primarily due to higher operating revenues and an increase in other income, as well as a lower effective income tax rate, partially offset by higher O&M expense and higher DD&A expense. The increase in operating revenues of $4.7 million, or 6%, was largely due to new demand charges for transportation service from the Company's Empire North expansion project, which was placed in service near the end of the fourth quarter of fiscal 2020, combined with an increase in revenues from a surcharge for pipeline safety and greenhouse gas regulatory costs, which went into effect in November 2020 in accordance with Supply Corporation's fiscal 2020 rate case settlement. Additionally, the Company recognized increased revenue from a surcharge mechanism for power costs related to electric motor drive compression on the Empire North project, for which offsetting
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O&M expense was recognized during the quarter. These positive items were partially offset by a modest decrease in transportation revenue from miscellaneous contract revisions. The increase in other income of $2.0 million was primarily due to an increase in allowance for funds used during construction (AFUDC) related to Supply Corporation's FM100 project. The reduction in the Pipeline and Storage segment's effective income tax rate was primarily due to timing differences in book and tax deductions. O&M expense increased $1.5 million primarily due to higher pipeline integrity costs, higher vehicle fuel costs and higher personnel costs, as well as the aforementioned Empire power costs. The increase in DD&A expense of $1.0 million was primarily attributable to incremental depreciation from the Empire North expansion project.
Gathering Segment
The Gathering segment’s operations are carried out by National Fuel Gas Midstream Company, LLC’s limited liability companies. The Gathering segment constructs, owns and operates natural gas gathering pipelines and compression facilities in the Appalachian region, which primarily delivers Seneca’s gross Appalachian production to the interstate pipeline system.
| Three Months Ended | |||||||||||||||||
| September 30, | |||||||||||||||||
| (in thousands) | 2021 | 2020 | Variance | ||||||||||||||
| GAAP Earnings | $ | 18,597 | $ | 17,550 | $ | 1,047 | |||||||||||
| Adjusted EBITDA | $ | 37,858 | $ | 33,062 | $ | 4,796 | |||||||||||
The Gathering segment’s fourth quarter GAAP earnings increased $1.0 million versus the prior year. The earnings increase was primarily driven by higher operating revenues, which was partially offset by higher DD&A expense, higher O&M expense and a higher effective income tax rate. Operating revenues increased $7.8 million, or 20%, primarily due to new Marcellus and Utica wells that were brought online, as well as from increased gathering throughput resulting from the Company's Appalachian acquisition in August 2020. Compression leasing expenses associated with the Appalachian acquisition were partially responsible for the $3.0 million increase in O&M expense, with the remainder of the increase due to higher compression facility and maintenance costs, as well as higher fuel costs. The increase in DD&A expense of $1.4 million was primarily attributable to incremental depreciation expense related to the Company's Appalachian acquisition, as well as higher average depreciable plant in service compared to the prior year. The increase in the Gathering segment's effective income tax rate was primarily driven by a higher effective state income tax rate as a result of the Company's Appalachian acquisition that caused a change in the mix of earnings between state jurisdictions.
Downstream Businesses
Utility Segment
The Utility segment operations are carried out by National Fuel Gas Distribution Corporation (“Distribution”), which sells or transports natural gas to customers located in western New York and northwestern Pennsylvania.
| Three Months Ended | |||||||||||||||||
| September 30, | |||||||||||||||||
| (in thousands) | 2021 | 2020 | Variance | ||||||||||||||
| GAAP Earnings | $ | (5,587) | $ | (6,969) | $ | 1,382 | |||||||||||
| Adjusted EBITDA | $ | 11,093 | $ | 8,550 | $ | 2,543 | |||||||||||
The Utility segment’s fourth quarter net loss was $1.4 million lower than the prior-year fourth quarter primarily due to higher customer margins (operating revenues less purchased gas sold) and lower O&M expense, partially offset by higher DD&A expense. The increase in customer margin was due primarily to the positive impact of adjustments related to certain regulatory rate and cost recovery mechanisms subject to annual reconciliation, as well as higher revenues from the Company's system modernization tracking mechanism in its New York service territory. O&M expense decreased $0.7 million primarily due to lower mandated regulatory compliance fees as well as lower accruals for the allowance for uncollectible accounts, which were higher in the prior-year fourth quarter from the economic backdrop brought on by COVID-19, partially offset by an increase in vehicle fuel costs. The $0.6 million increase in DD&A expense was primarily attributable to higher average depreciable plant in service compared to the prior year.
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Corporate and All Other
The Company’s operations that are included in Corporate and All Other generated a combined net loss of $3.2 million in the current year fourth quarter, generally consistent with the combined net loss of $3.0 million generated in the prior-year fourth quarter.
EARNINGS TELECONFERENCE
The Company will host a conference call on Friday, November 5, 2021, at 11 a.m. Eastern Time to discuss this announcement. Pre-registration is required to access the teleconference by phone in a listen-only mode by following this link: http://www.directeventreg.com/registration/event/1909399. To access the webcast, visit the Events Calendar under the News & Events page on the NFG Investor Relations website at investor.nationalfuelgas.com. A replay of the conference call will be available approximately two hours following the teleconference at the same website link and by phone (toll-free) at 800-585-8367 using conference ID number “1909399”. Both the webcast and conference call replay will be available until the close of business on Friday, November 12, 2021.
National Fuel is an integrated energy company reporting financial results for four operating segments: Exploration and Production, Pipeline and Storage, Gathering, and Utility. Additional information about National Fuel is available at www.nationalfuelgas.com.
| Analyst Contact: | Brandon J. Haspett | 716-857-7697 | ||||||
| Media Contact: | Karen L. Merkel | 716-857-7654 | ||||||
Certain statements contained herein, including statements identified by the use of the words “anticipates,” “estimates,” “expects,” “forecasts,” “intends,” “plans,” “predicts,” “projects,” “believes,” “seeks,” “will,” “may” and similar expressions, and statements which are other than statements of historical facts, are “forward-looking statements” as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties, which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. The Company’s expectations, beliefs and projections contained herein are expressed in good faith and are believed to have a reasonable basis, but there can be no assurance that such expectations, beliefs or projections will result or be achieved or accomplished. In addition to other factors, the following are important factors that could cause actual results to differ materially from those discussed in the forward-looking statements: changes in laws, regulations or judicial interpretations to which the Company is subject, including those involving derivatives, taxes, safety, employment, climate change, other environmental matters, real property, and exploration and production activities such as hydraulic fracturing; governmental/regulatory actions, initiatives and proceedings, including those involving rate cases (which address, among other things, target rates of return, rate design, retained natural gas and system modernization), environmental/safety requirements, affiliate relationships, industry structure, and franchise renewal; the Company’s ability to estimate accurately the time and resources necessary to meet emissions targets; governmental/regulatory actions and/or market pressures to reduce or eliminate reliance on natural gas; the length and severity of the ongoing COVID-19 pandemic, including its impacts across our businesses on demand, operations, global supply chains and liquidity; changes in economic conditions, including global, national or regional recessions, and their effect on the demand for, and customers’ ability to pay for, the Company’s products and services; changes in the price of natural gas or oil; the creditworthiness or performance of the Company’s key suppliers, customers and counterparties; financial and economic conditions, including the availability of credit, and occurrences affecting the Company’s ability to obtain financing on acceptable terms for working capital, capital expenditures and other investments, including any downgrades in the Company’s credit ratings and changes in interest rates and other capital market conditions; impairments under the SEC’s full cost ceiling test for natural gas and oil reserves; delays or changes in costs or plans with respect to Company projects or related projects of other companies, including disruptions due to the COVID-19 pandemic, as well as difficulties or delays in obtaining necessary governmental approvals, permits or orders or in obtaining the cooperation of interconnecting facility operators; the Company's ability to complete planned strategic transactions; the Company's ability to successfully integrate acquired assets and achieve expected cost synergies; changes in price differentials between similar quantities of natural gas or oil sold at different geographic locations, and the effect of such changes on commodity production, revenues and demand for pipeline transportation capacity to or from such locations; the impact of information technology disruptions, cybersecurity or data security breaches; factors affecting the Company’s ability to successfully identify, drill for and produce economically viable natural gas and oil reserves, including among others geology, lease availability, title disputes, weather conditions, shortages, delays or unavailability of equipment and services required in drilling operations, insufficient gathering, processing and transportation capacity, the need to obtain governmental approvals and permits, and compliance with environmental laws and regulations; increasing health care costs and the resulting effect on health insurance premiums and on the obligation to provide other post-retirement benefits; other changes in price differentials between similar quantities of natural gas or oil having different quality, heating value, hydrocarbon mix or delivery date; the cost and effects of legal and
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administrative claims against the Company or activist shareholder campaigns to effect changes at the Company; uncertainty of oil and gas reserve estimates; significant differences between the Company’s projected and actual production levels for natural gas or oil; changes in demographic patterns and weather conditions; changes in the availability, price or accounting treatment of derivative financial instruments; changes in laws, actuarial assumptions, the interest rate environment and the return on plan/trust assets related to the Company’s pension and other post-retirement benefits, which can affect future funding obligations and costs and plan liabilities; economic disruptions or uninsured losses resulting from major accidents, fires, severe weather, natural disasters, terrorist activities or acts of war; significant differences between the Company’s projected and actual capital expenditures and operating expenses; or increasing costs of insurance, changes in coverage and the ability to obtain insurance. The Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date thereof.
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yes
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
GUIDANCE SUMMARY
As discussed on page 2, the Company is revising its earnings guidance for fiscal 2022. Additional details on the Company's forecast assumptions and business segment guidance are outlined in the table below.
While the Company expects to record certain adjustments to unrealized gain or loss on investments during the fiscal year ending September 30, 2022, the amounts of these and other potential adjustments are not reasonably determinable at this time. As such, the Company is unable to provide earnings guidance other than on a non-GAAP basis.
| Preliminary FY 2022 Guidance | Updated FY 2022 Guidance | ||||||||||
Consolidated Earnings per Share, excluding items impacting comparability | $4.40 to $4.80 | $5.05 to $5.45 | |||||||||
| Consolidated Effective Tax Rate | ~ 25-26% | ~ 25-26% | |||||||||
Capital Expenditures (Millions) | |||||||||||
| Exploration and Production | $400 - $450 | $400 - $450 | |||||||||
| Pipeline and Storage | $100 - $150 | $100 - $150 | |||||||||
| Gathering | $50 - $60 | $50 - $60 | |||||||||
| Utility | $90 - $100 | $90 - $100 | |||||||||
| Consolidated Capital Expenditures | $640 - $760 | $640 - $760 | |||||||||
| Exploration & Production Segment Guidance | |||||||||||
| Commodity Price Assumptions | |||||||||||
| NYMEX natural gas price (Oct - Mar | Apr - Sep) | $3.50 /MMBtu | $5.50 /MMBtu | $3.75 /MMBtu | |||||||||
| Appalachian basin spot price (Oct - Mar | Apr - Sep) | $2.85 /MMBtu | $2.25 /MMBtu | $4.80 /MMBtu | $2.75 /MMBtu | |||||||||
| NYMEX (WTI) crude oil price | $65.00 /Bbl | $75.00 /Bbl | |||||||||
| California oil price premium (% of WTI) | 96% | 97% | |||||||||
| Production (Bcfe) | 335 to 365 | 335 to 365 | |||||||||
E&P Operating Costs ($/Mcfe) | |||||||||||
| LOE | $0.82 - $0.85 | $0.83 - $0.86 | |||||||||
| G&A | $0.19 - $0.21 | $0.19 - $0.21 | |||||||||
| DD&A | $0.59 - $0.62 | $0.59 - $0.62 | |||||||||
Other Business Segment Guidance (Millions) | |||||||||||
| Gathering Segment Revenues | $200 - $225 | $200 - $225 | |||||||||
| Pipeline and Storage Segment Revenues | $360 - $380 | $360 - $380 | |||||||||
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| NATIONAL FUEL GAS COMPANY | |||||||||||||||||||||||||||||||||||
| RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS | |||||||||||||||||||||||||||||||||||
| QUARTER ENDED SEPTEMBER 30, 2021 | |||||||||||||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||||||||||||
| Upstream | Midstream | Downstream | |||||||||||||||||||||||||||||||||
| Exploration & | Pipeline & | Corporate / | |||||||||||||||||||||||||||||||||
| (Thousands of Dollars) | Production | Storage | Gathering | Utility | All Other | Consolidated* | |||||||||||||||||||||||||||||
| Fourth quarter 2020 GAAP earnings | $ | (169,171) | $ | 16,045 | $ | 17,550 | $ | (6,969) | $ | (3,000) | $ | (145,545) | |||||||||||||||||||||||
| Items impacting comparability: | |||||||||||||||||||||||||||||||||||
| Impairment of oil and gas properties | 253,441 | 253,441 | |||||||||||||||||||||||||||||||||
| Tax impact of impairment of oil and gas properties | (69,698) | (69,698) | |||||||||||||||||||||||||||||||||
| Unrealized (gain) loss on other investments | (2,439) | (2,439) | |||||||||||||||||||||||||||||||||
Tax impact of unrealized (gain) loss on other investments | 512 | 512 | |||||||||||||||||||||||||||||||||
| Fourth quarter 2020 adjusted operating results | 14,572 | 16,045 | 17,550 | (6,969) | (4,927) | 36,271 | |||||||||||||||||||||||||||||
| Drivers of adjusted operating results** | |||||||||||||||||||||||||||||||||||
| Upstream Revenues | |||||||||||||||||||||||||||||||||||
| Higher (lower) natural gas production | 18,648 | 18,648 | |||||||||||||||||||||||||||||||||
| Higher (lower) crude oil production | (179) | (179) | |||||||||||||||||||||||||||||||||
| Higher (lower) realized natural gas prices, after hedging | 27,146 | 27,146 | |||||||||||||||||||||||||||||||||
| Higher (lower) realized crude oil prices, after hedging | 1,893 | 1,893 | |||||||||||||||||||||||||||||||||
| Midstream and All Other Revenues | |||||||||||||||||||||||||||||||||||
| Higher (lower) operating revenues | 3,712 | 6,160 | (768) | 9,104 | |||||||||||||||||||||||||||||||
| Downstream Margins*** | |||||||||||||||||||||||||||||||||||
Impact of usage and weather | (591) | (591) | |||||||||||||||||||||||||||||||||
| System modernization tracker revenues | 829 | 829 | |||||||||||||||||||||||||||||||||
| Regulatory revenue adjustments | 1,439 | 1,439 | |||||||||||||||||||||||||||||||||
| Operating Expenses | |||||||||||||||||||||||||||||||||||
| Lower (higher) lease operating and transportation expenses | (10,298) | (10,298) | |||||||||||||||||||||||||||||||||
| Lower (higher) operating expenses | (1,178) | (2,371) | 615 | 2,199 | (735) | ||||||||||||||||||||||||||||||
| Lower (higher) property, franchise and other taxes | (1,737) | (279) | (2,016) | ||||||||||||||||||||||||||||||||
| Lower (higher) depreciation / depletion | (1,318) | (781) | (1,133) | (505) | 912 | (2,825) | |||||||||||||||||||||||||||||
| Other Income (Expense) | |||||||||||||||||||||||||||||||||||
| (Higher) lower other deductions | 1,998 | 528 | 2,526 | ||||||||||||||||||||||||||||||||
| (Higher) lower interest expense | 2,854 | 847 | 273 | (916) | 3,058 | ||||||||||||||||||||||||||||||
| Income Taxes | |||||||||||||||||||||||||||||||||||
Lower (higher) income tax expense / effective tax rate | 3,906 | 1,662 | (1,360) | (551) | 114 | 3,771 | |||||||||||||||||||||||||||||
| All other / rounding | 216 | (544) | (249) | (127) | (63) | (767) | |||||||||||||||||||||||||||||
| Fourth quarter 2021 adjusted operating results | 55,703 | 21,482 | 18,597 | (5,587) | (2,921) | 87,274 | |||||||||||||||||||||||||||||
| Items impacting comparability: | |||||||||||||||||||||||||||||||||||
Unrealized gain (loss) on other investments | (395) | (395) | |||||||||||||||||||||||||||||||||
Tax impact of unrealized gain (loss) on other investments | 83 | 83 | |||||||||||||||||||||||||||||||||
| Fourth quarter 2021 GAAP earnings | $ | 55,703 | $ | 21,482 | $ | 18,597 | $ | (5,587) | $ | (3,233) | $ | 86,962 | |||||||||||||||||||||||
| * Amounts do not reflect intercompany eliminations. | |||||||||||||||||||||||||||||||||||
| ** Drivers of adjusted operating results have been calculated using the 21% federal statutory rate. | |||||||||||||||||||||||||||||||||||
| *** Downstream margin defined as operating revenues less purchased gas expense. | |||||||||||||||||||||||||||||||||||
Page 10.
| NATIONAL FUEL GAS COMPANY | |||||||||||||||||||||||||||||||||||
| RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS PER SHARE | |||||||||||||||||||||||||||||||||||
| QUARTER ENDED SEPTEMBER 30, 2021 | |||||||||||||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||||||||||||
| Upstream | Midstream | Downstream | |||||||||||||||||||||||||||||||||
| Exploration & | Pipeline & | Corporate / | |||||||||||||||||||||||||||||||||
| Production | Storage | Gathering | Utility | All Other | Consolidated* | ||||||||||||||||||||||||||||||
| Fourth quarter 2020 GAAP earnings per share | $ | (1.86) | $ | 0.18 | $ | 0.19 | $ | (0.08) | $ | (0.03) | $ | (1.60) | |||||||||||||||||||||||
| Items impacting comparability: | |||||||||||||||||||||||||||||||||||
| Impairment of oil and gas properties, net of tax | 2.02 | 2.02 | |||||||||||||||||||||||||||||||||
| Unrealized (gain) loss on other investments, net of tax | (0.02) | (0.02) | |||||||||||||||||||||||||||||||||
| Fourth quarter 2020 adjusted operating results per share | 0.16 | 0.18 | 0.19 | (0.08) | (0.05) | 0.40 | |||||||||||||||||||||||||||||
| Drivers of adjusted operating results** | |||||||||||||||||||||||||||||||||||
| Upstream Revenues | |||||||||||||||||||||||||||||||||||
| Higher (lower) natural gas production | 0.20 | 0.20 | |||||||||||||||||||||||||||||||||
| Higher (lower) crude oil production | — | — | |||||||||||||||||||||||||||||||||
Higher (lower) realized natural gas prices, after hedging | 0.30 | 0.30 | |||||||||||||||||||||||||||||||||
| Higher (lower) realized crude oil prices, after hedging | 0.02 | 0.02 | |||||||||||||||||||||||||||||||||
| Midstream and All Other Revenues | |||||||||||||||||||||||||||||||||||
Higher (lower) operating revenues | 0.04 | 0.07 | (0.01) | 0.10 | |||||||||||||||||||||||||||||||
| Downstream Margins*** | |||||||||||||||||||||||||||||||||||
Impact of usage and weather | (0.01) | (0.01) | |||||||||||||||||||||||||||||||||
| System modernization tracker revenues | 0.01 | 0.01 | |||||||||||||||||||||||||||||||||
| Regulatory revenue adjustments | 0.02 | 0.02 | |||||||||||||||||||||||||||||||||
| Operating Expenses | |||||||||||||||||||||||||||||||||||
Lower (higher) lease operating and transportation expenses | (0.11) | (0.11) | |||||||||||||||||||||||||||||||||
| Lower (higher) operating expenses | (0.01) | (0.03) | 0.01 | 0.02 | (0.01) | ||||||||||||||||||||||||||||||
| Lower (higher) property, franchise and other taxes | (0.02) | — | (0.02) | ||||||||||||||||||||||||||||||||
| Lower (higher) depreciation / depletion | (0.01) | (0.01) | (0.01) | (0.01) | 0.01 | (0.03) | |||||||||||||||||||||||||||||
| Other Income (Expense) | |||||||||||||||||||||||||||||||||||
| (Higher) lower other deductions | 0.02 | 0.01 | 0.03 | ||||||||||||||||||||||||||||||||
| (Higher) lower interest expense | 0.03 | 0.01 | — | (0.01) | 0.03 | ||||||||||||||||||||||||||||||
| Income Taxes | |||||||||||||||||||||||||||||||||||
Lower (higher) income tax expense / effective tax rate | 0.04 | 0.02 | (0.01) | (0.01) | — | 0.04 | |||||||||||||||||||||||||||||
| All other / rounding | — | (0.02) | (0.01) | 0.01 | — | (0.02) | |||||||||||||||||||||||||||||
| Fourth quarter 2021 adjusted operating results per share | 0.61 | 0.23 | 0.20 | (0.06) | (0.03) | 0.95 | |||||||||||||||||||||||||||||
| Items impacting comparability: | |||||||||||||||||||||||||||||||||||
Unrealized gain (loss) on other investments, net of tax | — | — | |||||||||||||||||||||||||||||||||
| Fourth quarter 2021 GAAP earnings per share | $ | 0.61 | $ | 0.23 | $ | 0.20 | $ | (0.06) | $ | (0.03) | $ | 0.95 | |||||||||||||||||||||||
| * Amounts do not reflect intercompany eliminations. | |||||||||||||||||||||||||||||||||||
| ** Drivers of adjusted operating results have been calculated using the 21% federal statutory rate. | |||||||||||||||||||||||||||||||||||
| *** Downstream margin defined as operating revenues less purchased gas expense. | |||||||||||||||||||||||||||||||||||
Page 11.
| NATIONAL FUEL GAS COMPANY | |||||||||||||||||||||||||||||||||||
| RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS | |||||||||||||||||||||||||||||||||||
| TWELVE MONTHS ENDED SEPTEMBER 30, 2021 | |||||||||||||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||||||||||||
| Upstream | Midstream | Downstream | |||||||||||||||||||||||||||||||||
| Exploration & | Pipeline & | Corporate / | |||||||||||||||||||||||||||||||||
| (Thousands of Dollars) | Production | Storage | Gathering | Utility | All Other | Consolidated* | |||||||||||||||||||||||||||||
| Fiscal 2020 GAAP earnings | $ | (326,904) | $ | 78,860 | $ | 68,631 | $ | 57,366 | $ | (1,725) | $ | (123,772) | |||||||||||||||||||||||
| Items impacting comparability: | |||||||||||||||||||||||||||||||||||
| Impairment of oil and gas properties | 449,438 | 449,438 | |||||||||||||||||||||||||||||||||
| Tax impact of impairment of oil and gas properties | (123,187) | (123,187) | |||||||||||||||||||||||||||||||||
| Deferred tax valuation allowance | 60,463 | (3,769) | 76 | 56,770 | |||||||||||||||||||||||||||||||
| Unrealized (gain) loss on other investments | (1,645) | (1,645) | |||||||||||||||||||||||||||||||||
Tax impact of unrealized (gain) loss on other investments | 345 | 345 | |||||||||||||||||||||||||||||||||
| Fiscal 2020 adjusted operating results | 59,810 | 78,860 | 64,862 | 57,366 | (2,949) | 257,949 | |||||||||||||||||||||||||||||
| Drivers of adjusted operating results** | |||||||||||||||||||||||||||||||||||
| Upstream Revenues | |||||||||||||||||||||||||||||||||||
| Higher (lower) natural gas production | 141,512 | 141,512 | |||||||||||||||||||||||||||||||||
| Higher (lower) crude oil production | (5,073) | (5,073) | |||||||||||||||||||||||||||||||||
| Higher (lower) realized natural gas prices, after hedging | 44,183 | 44,183 | |||||||||||||||||||||||||||||||||
| Higher (lower) realized crude oil prices, after hedging | (727) | (727) | |||||||||||||||||||||||||||||||||
| Midstream and All Other Revenues | |||||||||||||||||||||||||||||||||||
| Higher (lower) operating revenues | 26,823 | 39,793 | (2,693) | 63,923 | |||||||||||||||||||||||||||||||
| Downstream Margins*** | |||||||||||||||||||||||||||||||||||
Impact of usage and weather | (1,069) | (1,069) | |||||||||||||||||||||||||||||||||
| System modernization tracker revenues | 3,732 | 3,732 | |||||||||||||||||||||||||||||||||
| Regulatory revenue adjustments | 273 | 273 | |||||||||||||||||||||||||||||||||
| Higher (lower) energy marketing margins | (5,893) | (5,893) | |||||||||||||||||||||||||||||||||
| Operating Expenses | |||||||||||||||||||||||||||||||||||
Lower (higher) lease operating and transportation expenses | (50,280) | (50,280) | |||||||||||||||||||||||||||||||||
| Lower (higher) operating expenses | (5,262) | (2,443) | (8,899) | (2,585) | 4,101 | (15,088) | |||||||||||||||||||||||||||||
| Lower (higher) property, franchise and other taxes | (5,193) | (435) | (5,628) | ||||||||||||||||||||||||||||||||
| Lower (higher) depreciation / depletion | (8,191) | (6,699) | (7,829) | (1,745) | 1,439 | (23,025) | |||||||||||||||||||||||||||||
| Other Income (Expense) | |||||||||||||||||||||||||||||||||||
| (Higher) lower other deductions | 960 | (323) | 2,818 | 3,455 | |||||||||||||||||||||||||||||||
| (Higher) lower interest expense | 2,534 | (6,514) | (4,464) | (2,536) | (10,980) | ||||||||||||||||||||||||||||||
| Income Taxes | |||||||||||||||||||||||||||||||||||
Lower (higher) income tax expense / effective tax rate | (6,679) | 2,716 | (2,288) | (1,216) | 3,401 | (4,066) | |||||||||||||||||||||||||||||
| All other / rounding | 1,164 | (726) | (217) | (98) | (248) | (125) | |||||||||||||||||||||||||||||
| Fiscal 2021 adjusted operating results | 167,798 | 92,542 | 80,958 | 54,335 | (2,560) | 393,073 | |||||||||||||||||||||||||||||
| Items impacting comparability: | |||||||||||||||||||||||||||||||||||
Impairment of oil and gas properties | (76,152) | (76,152) | |||||||||||||||||||||||||||||||||
| Tax impact of impairment of oil and gas properties | 20,980 | 20,980 | |||||||||||||||||||||||||||||||||
| Gain on sale of timber properties | 51,066 | 51,066 | |||||||||||||||||||||||||||||||||
| Tax impact of gain on sale of timber properties | (14,069) | (14,069) | |||||||||||||||||||||||||||||||||
| Premium paid on early redemption of debt | (14,772) | (943) | (15,715) | ||||||||||||||||||||||||||||||||
| Tax impact of premium paid on early redemption of debt | 4,062 | 259 | 4,321 | ||||||||||||||||||||||||||||||||
Unrealized gain (loss) on other investments | 181 | 181 | |||||||||||||||||||||||||||||||||
Tax impact of unrealized gain (loss) on other investments | (38) | (38) | |||||||||||||||||||||||||||||||||
| Fiscal 2021 GAAP earnings | $ | 101,916 | $ | 92,542 | $ | 80,274 | $ | 54,335 | $ | 34,580 | $ | 363,647 | |||||||||||||||||||||||
| * Amounts do not reflect intercompany eliminations. | |||||||||||||||||||||||||||||||||||
| ** Drivers of adjusted operating results have been calculated using the 21% federal statutory rate. | |||||||||||||||||||||||||||||||||||
| *** Downstream margin defined as operating revenues less purchased gas expense. | |||||||||||||||||||||||||||||||||||
Page 12.
| NATIONAL FUEL GAS COMPANY | |||||||||||||||||||||||||||||||||||
| RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS PER SHARE | |||||||||||||||||||||||||||||||||||
| TWELVE MONTHS ENDED SEPTEMBER 30, 2021 | |||||||||||||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||||||||||||
| Upstream | Midstream | Downstream | |||||||||||||||||||||||||||||||||
| Exploration & | Pipeline & | Corporate / | |||||||||||||||||||||||||||||||||
| Production | Storage | Gathering | Utility | All Other | Consolidated* | ||||||||||||||||||||||||||||||
| Fiscal 2020 GAAP earnings per share | $ | (3.72) | $ | 0.90 | $ | 0.78 | $ | 0.65 | $ | (0.02) | $ | (1.41) | |||||||||||||||||||||||
| Items impacting comparability: | |||||||||||||||||||||||||||||||||||
| Impairment of oil and gas properties, net of tax | 3.71 | 3.71 | |||||||||||||||||||||||||||||||||
| Deferred tax valuation allowance | 0.69 | (0.04) | — | 0.65 | |||||||||||||||||||||||||||||||
| Unrealized (gain) loss on other investments, net of tax | (0.01) | (0.01) | |||||||||||||||||||||||||||||||||
| Earnings per share impact of diluted shares | (0.01) | (0.01) | (0.02) | ||||||||||||||||||||||||||||||||
| Fiscal 2020 adjusted operating results per share | 0.68 | 0.89 | 0.73 | 0.65 | (0.03) | 2.92 | |||||||||||||||||||||||||||||
| Drivers of adjusted operating results** | |||||||||||||||||||||||||||||||||||
| Upstream Revenues | |||||||||||||||||||||||||||||||||||
| Higher (lower) natural gas production | 1.54 | 1.54 | |||||||||||||||||||||||||||||||||
| Higher (lower) crude oil production | (0.06) | (0.06) | |||||||||||||||||||||||||||||||||
Higher (lower) realized natural gas prices, after hedging | 0.48 | 0.48 | |||||||||||||||||||||||||||||||||
| Higher (lower) realized crude oil prices, after hedging | (0.01) | (0.01) | |||||||||||||||||||||||||||||||||
| Midstream and All Other Revenues | |||||||||||||||||||||||||||||||||||
Higher (lower) operating revenues | 0.29 | 0.43 | (0.03) | 0.69 | |||||||||||||||||||||||||||||||
| Downstream Margins*** | |||||||||||||||||||||||||||||||||||
Impact of usage and weather | (0.01) | (0.01) | |||||||||||||||||||||||||||||||||
| System modernization tracker revenues | 0.04 | 0.04 | |||||||||||||||||||||||||||||||||
| Regulatory revenue adjustments | — | — | |||||||||||||||||||||||||||||||||
| Higher (lower) energy marketing margins | (0.06) | (0.06) | |||||||||||||||||||||||||||||||||
| Operating Expenses | |||||||||||||||||||||||||||||||||||
Lower (higher) lease operating and transportation expenses | (0.55) | (0.55) | |||||||||||||||||||||||||||||||||
| Lower (higher) operating expenses | (0.06) | (0.03) | (0.10) | (0.03) | 0.04 | (0.18) | |||||||||||||||||||||||||||||
| Lower (higher) property, franchise and other taxes | (0.06) | — | (0.06) | ||||||||||||||||||||||||||||||||
| Lower (higher) depreciation / depletion | (0.09) | (0.07) | (0.09) | (0.02) | 0.02 | (0.25) | |||||||||||||||||||||||||||||
| Other Income (Expense) | |||||||||||||||||||||||||||||||||||
| (Higher) lower other deductions | 0.01 | — | 0.03 | 0.04 | |||||||||||||||||||||||||||||||
| (Higher) lower interest expense | 0.03 | (0.07) | (0.05) | (0.03) | (0.12) | ||||||||||||||||||||||||||||||
| Income Taxes | |||||||||||||||||||||||||||||||||||
Lower (higher) income tax expense / effective tax rate | (0.07) | 0.03 | (0.02) | (0.01) | 0.04 | (0.03) | |||||||||||||||||||||||||||||
| Impact of additional shares | (0.02) | (0.03) | (0.03) | (0.03) | — | (0.11) | |||||||||||||||||||||||||||||
| All other / rounding | 0.02 | (0.01) | 0.01 | — | — | 0.02 | |||||||||||||||||||||||||||||
| Fiscal 2021 adjusted operating results per share | 1.83 | 1.01 | 0.88 | 0.59 | (0.02) | 4.29 | |||||||||||||||||||||||||||||
| Items impacting comparability: | |||||||||||||||||||||||||||||||||||
Impairment of oil and gas properties, net of tax | (0.60) | (0.60) | |||||||||||||||||||||||||||||||||
| Gain on sale of timber properties, net of tax | 0.40 | 0.40 | |||||||||||||||||||||||||||||||||
| Premium paid on early redemption of debt, net of tax | (0.12) | — | (0.12) | ||||||||||||||||||||||||||||||||
Unrealized gain (loss) on other investments, net of tax | — | — | |||||||||||||||||||||||||||||||||
| Fiscal 2021 GAAP earnings per share | $ | 1.11 | $ | 1.01 | $ | 0.88 | $ | 0.59 | $ | 0.38 | $ | 3.97 | |||||||||||||||||||||||
| * Amounts do not reflect intercompany eliminations. | |||||||||||||||||||||||||||||||||||
| ** Drivers of adjusted operating results have been calculated using the 21% federal statutory rate. | |||||||||||||||||||||||||||||||||||
| *** Downstream margin defined as operating revenues less purchased gas expense. | |||||||||||||||||||||||||||||||||||
Page 13.
| NATIONAL FUEL GAS COMPANY | ||||||||||||||||||||||||||
| AND SUBSIDIARIES | ||||||||||||||||||||||||||
| (Thousands of Dollars, except per share amounts) | ||||||||||||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||||||||
| (Unaudited) | (Unaudited) | |||||||||||||||||||||||||
| SUMMARY OF OPERATIONS | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||
| Operating Revenues: | ||||||||||||||||||||||||||
| Utility and Energy Marketing Revenues | $ | 80,302 | $ | 78,016 | $ | 667,549 | $ | 728,336 | ||||||||||||||||||
| Exploration and Production and Other Revenues | 215,664 | 155,811 | 837,597 | 611,885 | ||||||||||||||||||||||
| Pipeline and Storage and Gathering Revenues | 60,022 | 54,162 | 237,513 | 206,070 | ||||||||||||||||||||||
| 355,988 | 287,989 | 1,742,659 | 1,546,291 | |||||||||||||||||||||||
| Operating Expenses: | ||||||||||||||||||||||||||
| Purchased Gas | (5,190) | (5,773) | 171,827 | 233,890 | ||||||||||||||||||||||
| Operation and Maintenance: | ||||||||||||||||||||||||||
| Utility and Energy Marketing | 40,026 | 42,120 | 179,547 | 181,051 | ||||||||||||||||||||||
| Exploration and Production and Other | 46,007 | 39,800 | 173,041 | 148,856 | ||||||||||||||||||||||
| Pipeline and Storage and Gathering | 35,747 | 31,151 | 123,218 | 108,640 | ||||||||||||||||||||||
| Property, Franchise and Other Taxes | 23,454 | 21,132 | 94,713 | 88,400 | ||||||||||||||||||||||
| Depreciation, Depletion and Amortization | 83,671 | 80,097 | 335,303 | 306,158 | ||||||||||||||||||||||
| Impairment of Oil and Gas Producing Properties | — | 253,441 | 76,152 | 449,438 | ||||||||||||||||||||||
| 223,715 | 461,968 | 1,153,801 | 1,516,433 | |||||||||||||||||||||||
| Gain on Sale of Timber Properties | — | — | 51,066 | — | ||||||||||||||||||||||
| Operating Income (Loss) | 132,273 | (173,979) | 639,924 | 29,858 | ||||||||||||||||||||||
| Other Income (Expense): | ||||||||||||||||||||||||||
| Other Income (Deductions) | (160) | 159 | (15,238) | (17,814) | ||||||||||||||||||||||
| Interest Expense on Long-Term Debt | (30,161) | (32,159) | (141,457) | (110,012) | ||||||||||||||||||||||
| Other Interest Expense | (270) | (2,202) | (4,900) | (7,065) | ||||||||||||||||||||||
| Income (Loss) Before Income Taxes | 101,682 | (208,181) | 478,329 | (105,033) | ||||||||||||||||||||||
| Income Tax Expense (Benefit) | 14,720 | (62,636) | 114,682 | 18,739 | ||||||||||||||||||||||
| Net Income (Loss) Available for Common Stock | $ | 86,962 | $ | (145,545) | $ | 363,647 | $ | (123,772) | ||||||||||||||||||
| Earnings (Loss) Per Common Share | ||||||||||||||||||||||||||
| Basic | $ | 0.95 | $ | (1.60) | $ | 3.99 | $ | (1.41) | ||||||||||||||||||
| Diluted | $ | 0.95 | $ | (1.60) | $ | 3.97 | $ | (1.41) | ||||||||||||||||||
| Weighted Average Common Shares: | ||||||||||||||||||||||||||
| Used in Basic Calculation | 91,181,292 | 90,954,447 | 91,130,941 | 87,968,895 | ||||||||||||||||||||||
| Used in Diluted Calculation | 91,851,443 | 90,954,447 | 91,684,583 | 87,968,895 | ||||||||||||||||||||||
Page 14.
| NATIONAL FUEL GAS COMPANY | |||||||||||
| AND SUBSIDIARIES | |||||||||||
| CONSOLIDATED BALANCE SHEETS | |||||||||||
| (Unaudited) | |||||||||||
| September 30, | September 30, | ||||||||||
| (Thousands of Dollars) | 2021 | 2020 | |||||||||
| ASSETS | |||||||||||
| Property, Plant and Equipment | $13,103,639 | $12,351,852 | |||||||||
| Less - Accumulated Depreciation, Depletion and Amortization | 6,719,356 | 6,353,785 | |||||||||
Net Property, Plant and Equipment | 6,384,283 | 5,998,067 | |||||||||
| Assets Held for Sale, Net | — | 53,424 | |||||||||
| Current Assets: | |||||||||||
| Cash and Temporary Cash Investments | 31,528 | 20,541 | |||||||||
| Hedging Collateral Deposits | 88,610 | — | |||||||||
| Receivables - Net | 205,294 | 143,583 | |||||||||
| Unbilled Revenue | 17,000 | 17,302 | |||||||||
| Gas Stored Underground | 33,669 | 33,338 | |||||||||
| Materials, Supplies and Emission Allowances | 53,560 | 51,877 | |||||||||
| Unrecovered Purchased Gas Costs | 33,128 | — | |||||||||
| Other Current Assets | 59,660 | 47,557 | |||||||||
Total Current Assets | 522,449 | 314,198 | |||||||||
| Other Assets: | |||||||||||
| Recoverable Future Taxes | 121,992 | 118,310 | |||||||||
| Unamortized Debt Expense | 10,589 | 12,297 | |||||||||
| Other Regulatory Assets | 60,145 | 156,106 | |||||||||
| Deferred Charges | 59,939 | 67,131 | |||||||||
| Other Investments | 149,632 | 154,502 | |||||||||
| Goodwill | 5,476 | 5,476 | |||||||||
| Prepaid Post-Retirement Benefit Costs | 149,151 | 76,035 | |||||||||
| Fair Value of Derivative Financial Instruments | 1,169 | 9,308 | |||||||||
| Other | — | 81 | |||||||||
Total Other Assets | 558,093 | 599,246 | |||||||||
| Total Assets | $7,464,825 | $6,964,935 | |||||||||
| CAPITALIZATION AND LIABILITIES | |||||||||||
| Capitalization: | |||||||||||
| Comprehensive Shareholders' Equity | |||||||||||
| Common Stock, $1 Par Value Authorized - 200,000,000 Shares; Issued and | |||||||||||
Outstanding - 91,181,549 Shares and 90,954,696 Shares, Respectively | $91,182 | $90,955 | |||||||||
| Paid in Capital | 1,017,446 | 1,004,158 | |||||||||
| Earnings Reinvested in the Business | 1,191,175 | 991,630 | |||||||||
| Accumulated Other Comprehensive Loss | (513,597) | (114,757) | |||||||||
| Total Comprehensive Shareholders' Equity | 1,786,206 | 1,971,986 | |||||||||
| Long-Term Debt, Net of Current Portion and Unamortized Discount and Debt Issuance Costs | 2,628,687 | 2,629,576 | |||||||||
Total Capitalization | 4,414,893 | 4,601,562 | |||||||||
| Current and Accrued Liabilities: | |||||||||||
| Notes Payable to Banks and Commercial Paper | 158,500 | 30,000 | |||||||||
| Accounts Payable | 171,655 | 134,126 | |||||||||
| Amounts Payable to Customers | 21 | 10,788 | |||||||||
| Dividends Payable | 41,487 | 40,475 | |||||||||
| Interest Payable on Long-Term Debt | 17,376 | 27,521 | |||||||||
| Customer Advances | 17,223 | 15,319 | |||||||||
| Customer Security Deposits | 19,292 | 17,199 | |||||||||
| Other Accruals and Current Liabilities | 194,169 | 140,176 | |||||||||
| Fair Value of Derivative Financial Instruments | 616,410 | 43,969 | |||||||||
Total Current and Accrued Liabilities | 1,236,133 | 459,573 | |||||||||
| Other Liabilities: | |||||||||||
| Deferred Income Taxes | 660,420 | 696,054 | |||||||||
| Taxes Refundable to Customers | 354,089 | 357,508 | |||||||||
| Cost of Removal Regulatory Liability | 245,636 | 230,079 | |||||||||
| Other Regulatory Liabilities | 200,643 | 161,573 | |||||||||
| Pension and Other Post-Retirement Liabilities | 7,526 | 127,181 | |||||||||
| Asset Retirement Obligations | 209,639 | 192,228 | |||||||||
| Other Liabilities | 135,846 | 139,177 | |||||||||
| Total Other Liabilities | 1,813,799 | 1,903,800 | |||||||||
| Commitments and Contingencies | — | — | |||||||||
| Total Capitalization and Liabilities | $7,464,825 | $6,964,935 | |||||||||
Page 15.
| NATIONAL FUEL GAS COMPANY | ||||||||||||||
| AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Twelve Months Ended | ||||||||||||||
| September 30, | ||||||||||||||
| (Thousands of Dollars) | 2021 | 2020 | ||||||||||||
| Operating Activities: | ||||||||||||||
| Net Income (Loss) Available for Common Stock | $ | 363,647 | $ | (123,772) | ||||||||||
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided by Operating Activities: | ||||||||||||||
| Gain on Sale of Timber Properties | (51,066) | — | ||||||||||||
| Impairment of Oil and Gas Producing Properties | 76,152 | 449,438 | ||||||||||||
| Depreciation, Depletion and Amortization | 335,303 | 306,158 | ||||||||||||
| Deferred Income Taxes | 105,993 | 54,313 | ||||||||||||
| Premium Paid on Early Redemption of Debt | 15,715 | — | ||||||||||||
| Stock-Based Compensation | 17,065 | 14,931 | ||||||||||||
| Other | 10,896 | 6,527 | ||||||||||||
| Change in: | ||||||||||||||
| Receivables and Unbilled Revenue | (61,413) | (2,578) | ||||||||||||
| Gas Stored Underground and Materials, Supplies and Emission Allowances | (2,014) | (6,625) | ||||||||||||
| Unrecovered Purchased Gas Costs | (33,128) | 2,246 | ||||||||||||
| Other Current Assets | (11,972) | 49,367 | ||||||||||||
| Accounts Payable | 31,352 | (4,657) | ||||||||||||
| Amounts Payable to Customers | (10,767) | 6,771 | ||||||||||||
| Customer Advances | 1,904 | 2,275 | ||||||||||||
| Customer Security Deposits | 2,093 | 989 | ||||||||||||
| Other Accruals and Current Liabilities | 34,314 | 5,001 | ||||||||||||
| Other Assets | 1,250 | (24,203) | ||||||||||||
| Other Liabilities | (33,771) | 4,628 | ||||||||||||
| Net Cash Provided by Operating Activities | $ | 791,553 | $ | 740,809 | ||||||||||
| Investing Activities: | ||||||||||||||
| Capital Expenditures | $ | (751,734) | $ | (716,153) | ||||||||||
| Net Proceeds from Sale of Timber Properties | 104,582 | — | ||||||||||||
| Acquisition of Upstream Assets and Midstream Gathering Assets | — | (506,258) | ||||||||||||
| Other | 13,935 | (1,205) | ||||||||||||
| Net Cash Used in Investing Activities | $ | (633,217) | $ | (1,223,616) | ||||||||||
| Financing Activities: | ||||||||||||||
| Changes in Notes Payable to Banks and Commercial Paper | $ | 128,500 | $ | (25,200) | ||||||||||
| Reduction of Long-Term Debt | (515,715) | — | ||||||||||||
| Dividends Paid on Common Stock | (163,089) | (153,322) | ||||||||||||
| Net Proceeds From Issuance of Long-Term Debt | 495,267 | 493,007 | ||||||||||||
| Net Proceeds from Issuance (Repurchase) of Common Stock | (3,702) | 161,603 | ||||||||||||
| Net Cash Provided by (Used in) Financing Activities | $ | (58,739) | $ | 476,088 | ||||||||||
| Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash | 99,597 | (6,719) | ||||||||||||
| Cash, Cash Equivalents, and Restricted Cash at Beginning of Period | 20,541 | 27,260 | ||||||||||||
| Cash, Cash Equivalents, and Restricted Cash at September 30 | $ | 120,138 | $ | 20,541 | ||||||||||
Page 16.
| NATIONAL FUEL GAS COMPANY | |||||||||||||||||||||||||||||
| AND SUBSIDIARIES | |||||||||||||||||||||||||||||
| SEGMENT OPERATING RESULTS AND STATISTICS | |||||||||||||||||||||||||||||
| (UNAUDITED) | |||||||||||||||||||||||||||||
| UPSTREAM BUSINESS | |||||||||||||||||||||||||||||
| Three Months Ended | Twelve Months Ended | ||||||||||||||||||||||||||||
| (Thousands of Dollars, except per share amounts) | September 30, | September 30, | |||||||||||||||||||||||||||
| EXPLORATION AND PRODUCTION SEGMENT | 2021 | 2020 | Variance | 2021 | 2020 | Variance | |||||||||||||||||||||||
| Total Operating Revenues | $ | 215,581 | $ | 154,726 | $ | 60,855 | $ | 836,697 | $ | 607,453 | $ | 229,244 | |||||||||||||||||
| Operating Expenses: | |||||||||||||||||||||||||||||
| Operation and Maintenance: | |||||||||||||||||||||||||||||
| General and Administrative Expense | 16,957 | 16,653 | 304 | 67,973 | 63,429 | 4,544 | |||||||||||||||||||||||
| Lease Operating and Transportation Expense | 68,019 | 54,983 | 13,036 | 267,316 | 203,670 | 63,646 | |||||||||||||||||||||||
| All Other Operation and Maintenance Expense | 3,715 | 3,548 | 167 | 14,659 | 12,542 | 2,117 | |||||||||||||||||||||||
| Property, Franchise and Other Taxes | 6,302 | 4,103 | 2,199 | 22,220 | 15,646 | 6,574 | |||||||||||||||||||||||
| Depreciation, Depletion and Amortization | 45,135 | 43,467 | 1,668 | 182,492 | 172,124 | 10,368 | |||||||||||||||||||||||
| Impairment of Oil and Gas Producing Properties | — | 253,441 | (253,441) | 76,152 | 449,438 | (373,286) | |||||||||||||||||||||||
| 140,128 | 376,195 | (236,067) | 630,812 | 916,849 | (286,037) | ||||||||||||||||||||||||
| Operating Income (Loss) | 75,453 | (221,469) | 296,922 | 205,885 | (309,396) | 515,281 | |||||||||||||||||||||||
| Other Income (Expense): | |||||||||||||||||||||||||||||
| Non-Service Pension and Post-Retirement Benefit Costs | (289) | (395) | 106 | (1,148) | (1,580) | 432 | |||||||||||||||||||||||
| Interest and Other Income | 35 | 115 | (80) | 211 | 698 | (487) | |||||||||||||||||||||||
| Interest Expense on Long-Term Debt | — | — | — | (15,119) | — | (15,119) | |||||||||||||||||||||||
| Interest Expense | (11,942) | (15,555) | 3,613 | (54,543) | (58,098) | 3,555 | |||||||||||||||||||||||
| Income (Loss) Before Income Taxes | 63,257 | (237,304) | 300,561 | 135,286 | (368,376) | 503,662 | |||||||||||||||||||||||
| Income Tax Expense (Benefit) | 7,554 | (68,133) | 75,687 | 33,370 | (41,472) | 74,842 | |||||||||||||||||||||||
| Net Income (Loss) | $ | 55,703 | $ | (169,171) | $ | 224,874 | $ | 101,916 | $ | (326,904) | $ | 428,820 | |||||||||||||||||
| Net Income (Loss) Per Share (Diluted) | $ | 0.61 | $ | (1.86) | $ | 2.47 | $ | 1.11 | $ | (3.72) | $ | 4.83 | |||||||||||||||||
Page 17.
| NATIONAL FUEL GAS COMPANY | |||||||||||||||||||||||||||||
| AND SUBSIDIARIES | |||||||||||||||||||||||||||||
| SEGMENT OPERATING RESULTS AND STATISTICS | |||||||||||||||||||||||||||||
| (UNAUDITED) | |||||||||||||||||||||||||||||
| MIDSTREAM BUSINESSES | |||||||||||||||||||||||||||||
| Three Months Ended | Twelve Months Ended | ||||||||||||||||||||||||||||
| (Thousands of Dollars, except per share amounts) | September 30, | September 30, | |||||||||||||||||||||||||||
| PIPELINE AND STORAGE SEGMENT | 2021 | 2020 | Variance | 2021 | 2020 | Variance | |||||||||||||||||||||||
| Revenues from External Customers | $ | 58,515 | $ | 54,090 | $ | 4,425 | $ | 234,397 | $ | 205,998 | $ | 28,399 | |||||||||||||||||
| Intersegment Revenues | 26,510 | 26,236 | 274 | 109,160 | 103,606 | 5,554 | |||||||||||||||||||||||
| Total Operating Revenues | 85,025 | 80,326 | 4,699 | 343,557 | 309,604 | 33,953 | |||||||||||||||||||||||
| Operating Expenses: | |||||||||||||||||||||||||||||
| Purchased Gas | 764 | 74 | 690 | 983 | 75 | 908 | |||||||||||||||||||||||
| Operation and Maintenance | 26,724 | 25,233 | 1,491 | 90,533 | 87,440 | 3,093 | |||||||||||||||||||||||
| Property, Franchise and Other Taxes | 8,406 | 8,053 | 353 | 33,120 | 32,569 | 551 | |||||||||||||||||||||||
| Depreciation, Depletion and Amortization | 15,626 | 14,638 | 988 | 62,431 | 53,951 | 8,480 | |||||||||||||||||||||||
| 51,520 | 47,998 | 3,522 | 187,067 | 174,035 | 13,032 | ||||||||||||||||||||||||
| Operating Income | 33,505 | 32,328 | 1,177 | 156,490 | 135,569 | 20,921 | |||||||||||||||||||||||
| Other Income (Expense): | |||||||||||||||||||||||||||||
Non-Service Pension and Post-Retirement Benefit (Costs) Credit | 125 | (394) | 519 | 501 | (917) | 1,418 | |||||||||||||||||||||||
| Interest and Other Income | 2,180 | 701 | 1,479 | 5,339 | 5,552 | (213) | |||||||||||||||||||||||
| Interest Expense | (9,623) | (10,695) | 1,072 | (40,976) | (32,731) | (8,245) | |||||||||||||||||||||||
| Income Before Income Taxes | 26,187 | 21,940 | 4,247 | 121,354 | 107,473 | 13,881 | |||||||||||||||||||||||
| Income Tax Expense | 4,705 | 5,895 | (1,190) | 28,812 | 28,613 | 199 | |||||||||||||||||||||||
| Net Income | $ | 21,482 | $ | 16,045 | $ | 5,437 | $ | 92,542 | $ | 78,860 | $ | 13,682 | |||||||||||||||||
| Net Income Per Share (Diluted) | $ | 0.23 | $ | 0.18 | $ | 0.05 | $ | 1.01 | $ | 0.90 | $ | 0.11 | |||||||||||||||||
| Three Months Ended | Twelve Months Ended | ||||||||||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||||||||
| GATHERING SEGMENT | 2021 | 2020 | Variance | 2021 | 2020 | Variance | |||||||||||||||||||||||
| Revenues from External Customers | $ | 1,507 | $ | 72 | $ | 1,435 | $ | 3,116 | $ | 72 | $ | 3,044 | |||||||||||||||||
| Intersegment Revenues | 45,830 | 39,467 | 6,363 | 190,148 | 142,821 | 47,327 | |||||||||||||||||||||||
| Total Operating Revenues | 47,337 | 39,539 | 7,798 | 193,264 | 142,893 | 50,371 | |||||||||||||||||||||||
| Operating Expenses: | |||||||||||||||||||||||||||||
| Operation and Maintenance | 9,456 | 6,455 | 3,001 | 34,207 | 22,942 | 11,265 | |||||||||||||||||||||||
| Property, Franchise and Other Taxes | 23 | 22 | 1 | 52 | 72 | (20) | |||||||||||||||||||||||
| Depreciation, Depletion and Amortization | 8,219 | 6,785 | 1,434 | 32,350 | 22,440 | 9,910 | |||||||||||||||||||||||
| 17,698 | 13,262 | 4,436 | 66,609 | 45,454 | 21,155 | ||||||||||||||||||||||||
| Operating Income | 29,639 | 26,277 | 3,362 | 126,655 | 97,439 | 29,216 | |||||||||||||||||||||||
| Other Income (Expense): | |||||||||||||||||||||||||||||
| Non-Service Pension and Post-Retirement Benefit Costs | (68) | (71) | 3 | (271) | (285) | 14 | |||||||||||||||||||||||
| Interest and Other Income | 6 | 346 | (340) | 259 | 545 | (286) | |||||||||||||||||||||||
| Interest Expense on Long-Term Debt | — | — | — | (965) | — | (965) | |||||||||||||||||||||||
| Interest Expense | (4,093) | (4,115) | 22 | (16,528) | (10,877) | (5,651) | |||||||||||||||||||||||
| Income Before Income Taxes | 25,484 | 22,437 | 3,047 | 109,150 | 86,822 | 22,328 | |||||||||||||||||||||||
| Income Tax Expense | 6,887 | 4,887 | 2,000 | 28,876 | 18,191 | 10,685 | |||||||||||||||||||||||
| Net Income | $ | 18,597 | $ | 17,550 | $ | 1,047 | $ | 80,274 | $ | 68,631 | $ | 11,643 | |||||||||||||||||
| Net Income Per Share (Diluted) | $ | 0.20 | $ | 0.19 | $ | 0.01 | $ | 0.88 | $ | 0.78 | $ | 0.10 | |||||||||||||||||
Page 18.
| NATIONAL FUEL GAS COMPANY | |||||||||||||||||||||||||||||
| AND SUBSIDIARIES | |||||||||||||||||||||||||||||
| SEGMENT OPERATING RESULTS AND STATISTICS | |||||||||||||||||||||||||||||
| (UNAUDITED) | |||||||||||||||||||||||||||||
| DOWNSTREAM BUSINESS | |||||||||||||||||||||||||||||
| Three Months Ended | Twelve Months Ended | ||||||||||||||||||||||||||||
| (Thousands of Dollars, except per share amounts) | September 30, | September 30, | |||||||||||||||||||||||||||
| UTILITY SEGMENT | 2021 | 2020 | Variance | 2021 | 2020 | Variance | |||||||||||||||||||||||
| Revenues from External Customers | $ | 80,302 | $ | 73,000 | $ | 7,302 | $ | 666,920 | $ | 642,855 | $ | 24,065 | |||||||||||||||||
| Intersegment Revenues | 60 | 944 | (884) | 331 | 9,443 | (9,112) | |||||||||||||||||||||||
| Total Operating Revenues | 80,362 | 73,944 | 6,418 | 667,251 | 652,298 | 14,953 | |||||||||||||||||||||||
| Operating Expenses: | |||||||||||||||||||||||||||||
| Purchased Gas | 19,826 | 15,243 | 4,583 | 274,837 | 263,112 | 11,725 | |||||||||||||||||||||||
| Operation and Maintenance | 40,855 | 41,573 | (718) | 182,266 | 178,896 | 3,370 | |||||||||||||||||||||||
| Property, Franchise and Other Taxes | 8,588 | 8,578 | 10 | 38,769 | 38,872 | (103) | |||||||||||||||||||||||
| Depreciation, Depletion and Amortization | 14,646 | 14,007 | 639 | 57,457 | 55,248 | 2,209 | |||||||||||||||||||||||
| 83,915 | 79,401 | 4,514 | 553,329 | 536,128 | 17,201 | ||||||||||||||||||||||||
| Operating Income (Loss) | (3,553) | (5,457) | 1,904 | 113,922 | 116,170 | (2,248) | |||||||||||||||||||||||
| Other Income (Expense): | |||||||||||||||||||||||||||||
| Non-Service Pension and Post-Retirement Benefit Costs | (1,985) | (2,001) | 16 | (26,659) | (26,963) | 304 | |||||||||||||||||||||||
| Interest and Other Income | 733 | 589 | 144 | 2,874 | 3,583 | (709) | |||||||||||||||||||||||
| Interest Expense | (5,337) | (5,720) | 383 | (21,795) | (22,150) | 355 | |||||||||||||||||||||||
| Income (Loss) Before Income Taxes | (10,142) | (12,589) | 2,447 | 68,342 | 70,640 | (2,298) | |||||||||||||||||||||||
| Income Tax Expense (Benefit) | (4,555) | (5,620) | 1,065 | 14,007 | 13,274 | 733 | |||||||||||||||||||||||
| Net Income (Loss) | $ | (5,587) | $ | (6,969) | $ | 1,382 | $ | 54,335 | $ | 57,366 | $ | (3,031) | |||||||||||||||||
| Net Income (Loss) Per Share (Diluted) | $ | (0.06) | $ | (0.08) | $ | 0.02 | $ | 0.59 | $ | 0.65 | $ | (0.06) | |||||||||||||||||
Page 19.
| NATIONAL FUEL GAS COMPANY | |||||||||||||||||||||||||||||
| AND SUBSIDIARIES | |||||||||||||||||||||||||||||
| SEGMENT OPERATING RESULTS AND STATISTICS | |||||||||||||||||||||||||||||
| (UNAUDITED) | |||||||||||||||||||||||||||||
| Three Months Ended | Twelve Months Ended | ||||||||||||||||||||||||||||
| (Thousands of Dollars, except per share amounts) | September 30, | September 30, | |||||||||||||||||||||||||||
| ALL OTHER | 2021 | 2020 | Variance | 2021 | 2020 | Variance | |||||||||||||||||||||||
| Revenues from External Customers | $ | — | $ | 5,988 | $ | (5,988) | $ | 1,173 | $ | 89,435 | $ | (88,262) | |||||||||||||||||
| Intersegment Revenues | 26 | 237 | (211) | 49 | 836 | (787) | |||||||||||||||||||||||
| Total Operating Revenues | 26 | 6,225 | (6,199) | 1,222 | 90,271 | (89,049) | |||||||||||||||||||||||
| Operating Expenses: | |||||||||||||||||||||||||||||
| Purchased Gas | 9 | 5,263 | (5,254) | 2,306 | 80,485 | (78,179) | |||||||||||||||||||||||
| Operation and Maintenance | (20) | 2,139 | (2,159) | 682 | 7,895 | (7,213) | |||||||||||||||||||||||
| Property, Franchise and Other Taxes | — | 243 | (243) | 47 | 765 | (718) | |||||||||||||||||||||||
| Depreciation, Depletion and Amortization | — | 1,064 | (1,064) | 394 | 1,716 | (1,322) | |||||||||||||||||||||||
| (11) | 8,709 | (8,720) | 3,429 | 90,861 | (87,432) | ||||||||||||||||||||||||
| Gain on Sale of Timber Properties | — | — | — | 51,066 | — | 51,066 | |||||||||||||||||||||||
| Operating Income (Loss) | 37 | (2,484) | 2,521 | 48,859 | (590) | 49,449 | |||||||||||||||||||||||
| Other Income (Expense): | |||||||||||||||||||||||||||||
| Non-Service Pension and Post-Retirement Benefit Costs | — | (69) | 69 | (7) | (276) | 269 | |||||||||||||||||||||||
| Interest and Other Income | 2 | 201 | (199) | 231 | 873 | (642) | |||||||||||||||||||||||
| Interest Expense | — | (13) | 13 | — | (66) | 66 | |||||||||||||||||||||||
| Income (Loss) before Income Taxes | 39 | (2,365) | 2,404 | 49,083 | (59) | 49,142 | |||||||||||||||||||||||
| Income Tax Expense (Benefit) | 10 | (565) | 575 | 11,438 | 210 | 11,228 | |||||||||||||||||||||||
| Net Income (Loss) | $ | 29 | $ | (1,800) | $ | 1,829 | $ | 37,645 | $ | (269) | $ | 37,914 | |||||||||||||||||
| Net Income (Loss) Per Share (Diluted) | $ | — | $ | (0.02) | $ | 0.02 | $ | 0.41 | $ | — | $ | 0.41 | |||||||||||||||||
| Three Months Ended | Twelve Months Ended | ||||||||||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||||||||
| CORPORATE | 2021 | 2020 | Variance | 2021 | 2020 | Variance | |||||||||||||||||||||||
| Revenues from External Customers | $ | 83 | $ | 113 | $ | (30) | $ | 356 | $ | 478 | $ | (122) | |||||||||||||||||
| Intersegment Revenues | 1,146 | 1,463 | (317) | 3,864 | 4,744 | (880) | |||||||||||||||||||||||
| Total Operating Revenues | 1,229 | 1,576 | (347) | 4,220 | 5,222 | (1,002) | |||||||||||||||||||||||
| Operating Expenses: | |||||||||||||||||||||||||||||
| Operation and Maintenance | 3,857 | 4,481 | (624) | 15,423 | 13,401 | 2,022 | |||||||||||||||||||||||
| Property, Franchise and Other Taxes | 135 | 133 | 2 | 505 | 476 | 29 | |||||||||||||||||||||||
| Depreciation, Depletion and Amortization | 45 | 136 | (91) | 179 | 679 | (500) | |||||||||||||||||||||||
| 4,037 | 4,750 | (713) | 16,107 | 14,556 | 1,551 | ||||||||||||||||||||||||
| Operating Loss | (2,808) | (3,174) | 366 | (11,887) | (9,334) | (2,553) | |||||||||||||||||||||||
| Other Income (Expense): | |||||||||||||||||||||||||||||
| Non-Service Pension and Post-Retirement Benefit Costs | (923) | (775) | (148) | (3,692) | (3,101) | (591) | |||||||||||||||||||||||
| Interest and Other Income | 31,154 | 37,730 | (6,576) | 138,882 | 127,524 | 11,358 | |||||||||||||||||||||||
| Interest Expense on Long-Term Debt | (30,161) | (32,159) | 1,998 | (125,373) | (110,012) | (15,361) | |||||||||||||||||||||||
| Other Interest Expense | (405) | (1,922) | 1,517 | (2,816) | (6,610) | 3,794 | |||||||||||||||||||||||
| Loss before Income Taxes | (3,143) | (300) | (2,843) | (4,886) | (1,533) | (3,353) | |||||||||||||||||||||||
| Income Tax Expense (Benefit) | 119 | 900 | (781) | (1,821) | (77) | (1,744) | |||||||||||||||||||||||
| Net Loss | $ | (3,262) | $ | (1,200) | $ | (2,062) | $ | (3,065) | $ | (1,456) | $ | (1,609) | |||||||||||||||||
| Net Loss Per Share (Diluted) | $ | (0.03) | $ | (0.01) | $ | (0.02) | $ | (0.03) | $ | (0.02) | $ | (0.01) | |||||||||||||||||
| Three Months Ended | Twelve Months Ended | ||||||||||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||||||||
| INTERSEGMENT ELIMINATIONS | 2021 | 2020 | Variance | 2021 | 2020 | Variance | |||||||||||||||||||||||
| Intersegment Revenues | $ | (73,572) | $ | (68,347) | $ | (5,225) | $ | (303,552) | $ | (261,450) | $ | (42,102) | |||||||||||||||||
| Operating Expenses: | |||||||||||||||||||||||||||||
| Purchased Gas | (25,789) | (26,353) | 564 | (106,299) | (109,782) | 3,483 | |||||||||||||||||||||||
| Operation and Maintenance | (47,783) | (41,994) | (5,789) | (197,253) | (151,668) | (45,585) | |||||||||||||||||||||||
| (73,572) | (68,347) | (5,225) | (303,552) | (261,450) | (42,102) | ||||||||||||||||||||||||
| Operating Income | — | — | — | — | — | — | |||||||||||||||||||||||
| Other Income (Expense): | |||||||||||||||||||||||||||||
| Interest and Other Deductions | (31,130) | (35,818) | 4,688 | (131,758) | (123,467) | (8,291) | |||||||||||||||||||||||
| Interest Expense | 31,130 | 35,818 | (4,688) | 131,758 | 123,467 | 8,291 | |||||||||||||||||||||||
| Net Income | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||
| Net Income Per Share (Diluted) | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||
Page 20.
| NATIONAL FUEL GAS COMPANY | |||||||||||||||||||||||||||||||||||
| AND SUBSIDIARIES | |||||||||||||||||||||||||||||||||||
| SEGMENT INFORMATION (Continued) | |||||||||||||||||||||||||||||||||||
| (Thousands of Dollars) | |||||||||||||||||||||||||||||||||||
| Three Months Ended | Twelve Months Ended | ||||||||||||||||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||||||||||||||
| (Unaudited) | (Unaudited) | ||||||||||||||||||||||||||||||||||
| Increase | Increase | ||||||||||||||||||||||||||||||||||
| 2021 | 2020 | (Decrease) | 2021 | 2020 | (Decrease) | ||||||||||||||||||||||||||||||
| Capital Expenditures: | |||||||||||||||||||||||||||||||||||
Exploration and Production(4) | $ | 117,646 | (1) | $ | 375,466 | (2) | $ | (257,820) | $ | 381,408 | (1)(2) | $ | 670,455 | (2)(3) | $ | (289,047) | |||||||||||||||||||
| Pipeline and Storage | 96,760 | (1) | 42,520 | (2) | 54,240 | 252,316 | (1)(2) | 166,652 | (2)(3) | 85,664 | |||||||||||||||||||||||||
Gathering(5) | 9,041 | (1) | 251,606 | (2) | (242,565) | 34,669 | (1)(2) | 297,806 | (2)(3) | (263,137) | |||||||||||||||||||||||||
| Utility | 34,154 | (1) | 32,034 | (2) | 2,120 | 100,845 | (1)(2) | 94,273 | (2)(3) | 6,572 | |||||||||||||||||||||||||
| Total Reportable Segments | 257,601 | 701,626 | (444,025) | 769,238 | 1,229,186 | (459,948) | |||||||||||||||||||||||||||||
| All Other | — | 2 | (2) | — | 39 | (39) | |||||||||||||||||||||||||||||
| Corporate | 231 | 102 | 129 | 450 | 522 | (72) | |||||||||||||||||||||||||||||
| Eliminations | 2,341 | (1,130) | 3,471 | 223 | (1,130) | 1,353 | |||||||||||||||||||||||||||||
| Total Capital Expenditures | $ | 260,173 | $ | 700,600 | $ | (440,427) | $ | 769,911 | $ | 1,228,617 | $ | (458,706) | |||||||||||||||||||||||
(1)Capital expenditures for the quarter and year ended September 30, 2021, include accounts payable and accrued liabilities related to capital expenditures of $47.9 million, $39.4 million, $4.8 million, and $10.6 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts have been excluded from the Consolidated Statement of Cash Flows at September 30, 2021, since they represent non-cash investing activities at that date.
(2)Capital expenditures for the year ended September 30, 2021, exclude capital expenditures of $45.8 million, $17.3 million, $13.5 million and $10.7 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts were in accounts payable and accrued liabilities at September 30, 2020 and paid during the year ended September 30, 2021. These amounts were excluded from the Consolidated Statement of Cash Flows at September 30, 2020, since they represented non-cash investing activities at that date. These amounts have been included in the Consolidated Statement of Cash Flows at September 30, 2021.
(3)Capital expenditures for the year ended September 30, 2020, exclude capital expenditures of $38.0 million, $23.8 million, $6.6 million and $12.7 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts were in accounts payable and accrued liabilities at September 30, 2019 and paid during the year ended September 30, 2020. These amounts were excluded from the Consolidated Statement of Cash Flows at September 30, 2019, since they represented non-cash investing activities at that date. These amounts have been included in the Consolidated Statement of Cash Flows at September 30, 2020.
(4)2020 includes $282.8 million related to the acquisition of upstream assets acquired from Shell, of which $281.7 million is included in Property, Plant and Equipment and $1.1 million is included in Materials, Supplies and Emission Allowances.
(5)2020 includes $223.5 million related to the acquisition of midstream gathering assets acquired from Shell, of which $223.4 million is included in Property, Plant and Equipment and $0.1 million is included in Materials, Supplies and Emission Allowances.
| DEGREE DAYS | |||||||||||||||||||||||||||||
| Percent Colder | |||||||||||||||||||||||||||||
| (Warmer) Than: | |||||||||||||||||||||||||||||
| Three Months Ended September 30, | Normal | 2021 | 2020 | Normal (1) | Last Year (1) | ||||||||||||||||||||||||
| Buffalo, NY | 162 | 38 | 101 | (76.5) | (62.4) | ||||||||||||||||||||||||
| Erie, PA | 124 | 33 | 68 | (73.4) | (51.5) | ||||||||||||||||||||||||
| Twelve Months Ended September 30, | |||||||||||||||||||||||||||||
| Buffalo, NY | 6,617 | 5,731 | 6,103 | (13.4) | (6.1) | ||||||||||||||||||||||||
| Erie, PA | 6,147 | 5,221 | 5,449 | (15.1) | (4.2) | ||||||||||||||||||||||||
(1)Percents compare actual 2021 degree days to normal degree days and actual 2021 degree days to actual 2020 degree days.
Page 21.
| NATIONAL FUEL GAS COMPANY | ||||||||||||||||||||||||||||||||||||||
| AND SUBSIDIARIES | ||||||||||||||||||||||||||||||||||||||
| EXPLORATION AND PRODUCTION INFORMATION | ||||||||||||||||||||||||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||||||||||||||||||||
| Increase | Increase | |||||||||||||||||||||||||||||||||||||
| 2021 | 2020 | (Decrease) | 2021 | 2020 | (Decrease) | |||||||||||||||||||||||||||||||||
| Gas Production/Prices: | ||||||||||||||||||||||||||||||||||||||
| Production (MMcf) | ||||||||||||||||||||||||||||||||||||||
| Appalachia | 75,871 | 63,548 | 12,323 | 312,300 | 225,513 | 86,787 | ||||||||||||||||||||||||||||||||
| West Coast | 420 | 455 | (35) | 1,720 | 1,889 | (169) | ||||||||||||||||||||||||||||||||
| Total Production | 76,291 | 64,003 | 12,288 | 314,020 | 227,402 | 86,618 | ||||||||||||||||||||||||||||||||
| Average Prices (Per Mcf) | ||||||||||||||||||||||||||||||||||||||
| Appalachia | $ | 3.14 | $ | 1.63 | $ | 1.51 | $ | 2.46 | $ | 1.75 | $ | 0.71 | ||||||||||||||||||||||||||
| West Coast | 7.93 | 3.31 | 4.62 | 6.34 | 3.82 | 2.52 | ||||||||||||||||||||||||||||||||
| Weighted Average | 3.16 | 1.64 | 1.52 | 2.49 | 1.77 | 0.72 | ||||||||||||||||||||||||||||||||
| Weighted Average after Hedging | 2.37 | 1.92 | 0.45 | 2.25 | 2.07 | 0.18 | ||||||||||||||||||||||||||||||||
| Oil Production/Prices: | ||||||||||||||||||||||||||||||||||||||
| Production (Thousands of Barrels) | ||||||||||||||||||||||||||||||||||||||
| Appalachia | 1 | 1 | — | 2 | 3 | (1) | ||||||||||||||||||||||||||||||||
| West Coast | 551 | 555 | (4) | 2,233 | 2,345 | (112) | ||||||||||||||||||||||||||||||||
| Total Production | 552 | 556 | (4) | 2,235 | 2,348 | (113) | ||||||||||||||||||||||||||||||||
| Average Prices (Per Barrel) | ||||||||||||||||||||||||||||||||||||||
| Appalachia | $ | 66.34 | $ | 31.22 | $ | 35.12 | $ | 48.02 | $ | 45.69 | $ | 2.33 | ||||||||||||||||||||||||||
| West Coast | 71.46 | 41.22 | 30.24 | 60.50 | 45.94 | 14.56 | ||||||||||||||||||||||||||||||||
| Weighted Average | 71.45 | 41.21 | 30.24 | 60.49 | 45.94 | 14.55 | ||||||||||||||||||||||||||||||||
| Weighted Average after Hedging | 60.04 | 55.70 | 4.34 | 56.54 | 56.96 | (0.42) | ||||||||||||||||||||||||||||||||
| Total Production (MMcfe) | 79,603 | 67,339 | 12,264 | 327,430 | 241,490 | 85,940 | ||||||||||||||||||||||||||||||||
| Selected Operating Performance Statistics: | ||||||||||||||||||||||||||||||||||||||
General & Administrative Expense per Mcfe (1) | $ | 0.21 | $ | 0.25 | $ | (0.04) | $ | 0.21 | $ | 0.26 | $ | (0.05) | ||||||||||||||||||||||||||
Lease Operating and Transportation Expense per Mcfe (1)(2) | $ | 0.85 | $ | 0.82 | $ | 0.03 | $ | 0.82 | $ | 0.84 | $ | (0.02) | ||||||||||||||||||||||||||
Depreciation, Depletion & Amortization per Mcfe (1) | $ | 0.57 | $ | 0.65 | $ | (0.08) | $ | 0.56 | $ | 0.71 | $ | (0.15) | ||||||||||||||||||||||||||
(1)Refer to page 16 for the General and Administrative Expense, Lease Operating and Transportation Expense and Depreciation, Depletion, and Amortization Expense for the Exploration and Production segment.
(2)Amounts include transportation expense of $0.55 and $0.57 per Mcfe for the three months ended September 30, 2021 and September 30, 2020, respectively. Amounts include transportation expense of $0.57 and $0.57 per Mcfe for the twelve months ended September 30, 2021 and September 30, 2020, respectively.
Page 22.
| NATIONAL FUEL GAS COMPANY | ||||||||||||||||||||
| AND SUBSIDIARIES | ||||||||||||||||||||
| EXPLORATION AND PRODUCTION INFORMATION | ||||||||||||||||||||
| Hedging Summary for Fiscal 2022 | Volume | Average Hedge Price | ||||||||||||||||||
| Oil Swaps | ||||||||||||||||||||
| Brent | 1,140,000 | BBL | $ | 58.28 / BBL | ||||||||||||||||
| NYMEX | 156,000 | BBL | $ | 51.00 / BBL | ||||||||||||||||
| Total | 1,296,000 | BBL | $ | 57.40 / BBL | ||||||||||||||||
| Gas Swaps | ||||||||||||||||||||
| NYMEX | 208,500,000 | MMBTU | $ | 2.75 / MMBTU | ||||||||||||||||
| No Cost Collars | 2,350,000 | MMBTU | $ | 2.28 / MMBTU (Floor) / $2.77 / MMBTU (Ceiling) | ||||||||||||||||
| Fixed Price Physical Sales | 52,309,623 | MMBTU | $ | 2.29 / MMBTU | ||||||||||||||||
| Total | 263,159,623 | MMBTU | ||||||||||||||||||
| Hedging Summary for Fiscal 2023 | Volume | Average Hedge Price | ||||||||||||||||||
| Oil Swaps | ||||||||||||||||||||
| Brent | 480,000 | BBL | $ | 58.48 / BBL | ||||||||||||||||
| Total | 480,000 | BBL | $ | 58.48 / BBL | ||||||||||||||||
| Gas Swaps | ||||||||||||||||||||
| NYMEX | 116,200,000 | MMBTU | $ | 2.79 / MMBTU | ||||||||||||||||
| No Cost Collars | 17,600,000 | MMBTU | $ | 2.78 / MMBTU (Floor) / $3.19 / MMBTU (Ceiling) | ||||||||||||||||
| Fixed Price Physical Sales | 57,082,943 | MMBTU | $ | 2.23 / MMBTU | ||||||||||||||||
| Total | 190,882,943 | MMBTU | ||||||||||||||||||
| Hedging Summary for Fiscal 2024 | Volume | Average Hedge Price | ||||||||||||||||||
| Oil Swaps | ||||||||||||||||||||
| Brent | 120,000 | BBL | $ | 50.30 / BBL | ||||||||||||||||
| Total | 120,000 | BBL | $ | 50.30 / BBL | ||||||||||||||||
| Gas Swaps | ||||||||||||||||||||
| NYMEX | 61,080,000 | MMBTU | $ | 2.72 / MMBTU | ||||||||||||||||
| No Cost Collars | 1,600,000 | MMBTU | $ | 2.78 / MMBTU (Floor) / $3.19 / MMBTU (Ceiling) | ||||||||||||||||
| Fixed Price Physical Sales | 42,872,216 | MMBTU | $ | 2.19 / MMBTU | ||||||||||||||||
| Total | 105,552,216 | MMBTU | ||||||||||||||||||
| Hedging Summary for Fiscal 2025 | Volume | Average Hedge Price | ||||||||||||||||||
| Oil Swaps | ||||||||||||||||||||
| Brent | 120,000 | BBL | $ | 50.32 / BBL | ||||||||||||||||
| Total | 120,000 | BBL | $ | 50.32 / BBL | ||||||||||||||||
| Gas Swaps | ||||||||||||||||||||
| NYMEX | 23,660,000 | MMBTU | $ | 2.74 / MMBTU | ||||||||||||||||
| Fixed Price Physical Sales | 36,520,814 | MMBTU | $ | 2.18 / MMBTU | ||||||||||||||||
| Total | 60,180,814 | MMBTU | ||||||||||||||||||
| Hedging Summary for Fiscal 2026 | Volume | Average Hedge Price | ||||||||||||||||||
| Gas Swaps | ||||||||||||||||||||
| NYMEX | 1,720,000 | MMBTU | $ | 2.75 / MMBTU | ||||||||||||||||
| Fixed Price Physical Sales | 27,780,276 | MMBTU | $ | 2.19 / MMBTU | ||||||||||||||||
| Total | 29,500,276 | MMBTU | ||||||||||||||||||
| Hedging Summary for Fiscal 2027 | Volume | Average Hedge Price | ||||||||||||||||||
| Fixed Price Physical Sales | 17,348,882 | MMBTU | $ | 2.22 / MMBTU | ||||||||||||||||
| Hedging Summary for Fiscal 2028 | Volume | Average Hedge Price | ||||||||||||||||||
| Fixed Price Physical Sales | 1,400,555 | MMBTU | $ | 2.23 / MMBTU | ||||||||||||||||
Page 23.
| NATIONAL FUEL GAS COMPANY | ||||||||||||||
| AND SUBSIDIARIES | ||||||||||||||
| EXPLORATION AND PRODUCTION INFORMATION | ||||||||||||||
| Reserve Quantity Information | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Gas MMcf | ||||||||||||||
| U.S. | ||||||||||||||
| Appalachian | West Coast | Total | ||||||||||||
| Region | Region | Company | ||||||||||||
| Proved Developed and Undeveloped Reserves: | ||||||||||||||
| September 30, 2020 | 3,296,113 | 28,972 | 3,325,085 | |||||||||||
| Extensions and Discoveries | 689,395 | — | 689,395 | |||||||||||
| Revisions of Previous Estimates | 19,940 | 3,033 | 22,973 | |||||||||||
| Production | (312,300) | (1,720) | (314,020) | |||||||||||
| September 30, 2021 | 3,693,148 | 30,285 | 3,723,433 | |||||||||||
| Proved Developed Reserves: | ||||||||||||||
| September 30, 2020 | 2,744,851 | 28,972 | 2,773,823 | |||||||||||
| September 30, 2021 | 3,061,178 | 30,285 | 3,091,463 | |||||||||||
| Oil Mbbl | ||||||||||||||
| U.S. | ||||||||||||||
| Appalachian | West Coast | Total | ||||||||||||
| Region | Region | Company | ||||||||||||
| Proved Developed and Undeveloped Reserves: | ||||||||||||||
| September 30, 2020 | 12 | 22,088 | 22,100 | |||||||||||
| Extensions and Discoveries | — | 1,041 | 1,041 | |||||||||||
| Revisions of Previous Estimates | 1 | 630 | 631 | |||||||||||
| Production | (2) | (2,233) | (2,235) | |||||||||||
| September 30, 2021 | 11 | 21,526 | 21,537 | |||||||||||
| Proved Developed Reserves: | ||||||||||||||
| September 30, 2020 | 12 | 22,088 | 22,100 | |||||||||||
| September 30, 2021 | 11 | 20,932 | 20,943 | |||||||||||
Page 24.
| NATIONAL FUEL GAS COMPANY | ||||||||||||||||||||||||||||||||||||||
| AND SUBSIDIARIES | ||||||||||||||||||||||||||||||||||||||
| Pipeline & Storage Throughput - (millions of cubic feet - MMcf) | ||||||||||||||||||||||||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||||||||||||||||||||
| Increase | Increase | |||||||||||||||||||||||||||||||||||||
| 2021 | 2020 | (Decrease) | 2021 | 2020 | (Decrease) | |||||||||||||||||||||||||||||||||
| Firm Transportation - Affiliated | 14,916 | 13,021 | 1,895 | 107,206 | 111,166 | (3,960) | ||||||||||||||||||||||||||||||||
| Firm Transportation - Non-Affiliated | 168,619 | 162,727 | 5,892 | 663,078 | 641,607 | 21,471 | ||||||||||||||||||||||||||||||||
| Interruptible Transportation | 256 | 857 | (601) | 1,460 | 2,859 | (1,399) | ||||||||||||||||||||||||||||||||
| 183,791 | 176,605 | 7,186 | 771,744 | 755,632 | 16,112 | |||||||||||||||||||||||||||||||||
| Gathering Volume - (MMcf) | ||||||||||||||||||||||||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||||||||||||||||||||
| Increase | Increase | |||||||||||||||||||||||||||||||||||||
| 2021 | 2020 | (Decrease) | 2021 | 2020 | (Decrease) | |||||||||||||||||||||||||||||||||
| Gathered Volume | 90,750 | 73,441 | 17,309 | 366,033 | 264,305 | 101,728 | ||||||||||||||||||||||||||||||||
| Utility Throughput - (MMcf) | ||||||||||||||||||||||||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||||||||||||||||||||
| Increase | Increase | |||||||||||||||||||||||||||||||||||||
| 2021 | 2020 | (Decrease) | 2021 | 2020 | (Decrease) | |||||||||||||||||||||||||||||||||
| Retail Sales: | ||||||||||||||||||||||||||||||||||||||
| Residential Sales | 3,797 | 4,033 | (236) | 61,038 | 60,977 | 61 | ||||||||||||||||||||||||||||||||
| Commercial Sales | 535 | 503 | 32 | 8,741 | 8,798 | (57) | ||||||||||||||||||||||||||||||||
| Industrial Sales | 33 | 31 | 2 | 475 | 537 | (62) | ||||||||||||||||||||||||||||||||
| 4,365 | 4,567 | (202) | 70,254 | 70,312 | (58) | |||||||||||||||||||||||||||||||||
| Transportation | 10,197 | 9,040 | 1,157 | 66,012 | 68,272 | (2,260) | ||||||||||||||||||||||||||||||||
| 14,562 | 13,607 | 955 | 136,266 | 138,584 | (2,318) | |||||||||||||||||||||||||||||||||
Page 25.
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
NON-GAAP FINANCIAL MEASURES
In addition to financial measures calculated in accordance with generally accepted accounting principles (GAAP), this press release contains information regarding Adjusted Operating Results, Adjusted EBITDA and free cash flow, which are non-GAAP financial measures. The Company believes that these non-GAAP financial measures are useful to investors because they provide an alternative method for assessing the Company's ongoing operating results or liquidity and for comparing the Company’s financial performance to other companies. The Company's management uses these non-GAAP financial measures for the same purpose, and for planning and forecasting purposes. The presentation of non-GAAP financial measures is not meant to be a substitute for financial measures in accordance with GAAP.
Management defines Adjusted Operating Results as reported GAAP earnings before items impacting comparability. The following table reconciles National Fuel's reported GAAP earnings to Adjusted Operating Results for the three and twelve months ended September 30, 2021 and 2020:
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||||||||
| (in thousands except per share amounts) | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||
| Reported GAAP Earnings | $ | 86,962 | $ | (145,545) | $ | 363,647 | $ | (123,772) | ||||||||||||||||||
Items impacting comparability: | ||||||||||||||||||||||||||
Impairment of oil and gas properties (E&P) | — | 253,441 | 76,152 | 449,438 | ||||||||||||||||||||||
Tax impact of impairment of oil and gas properties | — | (69,698) | (20,980) | (123,187) | ||||||||||||||||||||||
| Gain on sale of timber properties (Corporate/All Other) | — | — | (51,066) | — | ||||||||||||||||||||||
| Tax impact of gain on sale of timber properties | — | — | 14,069 | — | ||||||||||||||||||||||
| Premium paid on early redemption of debt | — | — | 15,715 | — | ||||||||||||||||||||||
| Tax impact of premium paid on early redemption of debt | — | — | (4,321) | — | ||||||||||||||||||||||
| Deferred tax valuation allowance | — | — | — | 56,770 | ||||||||||||||||||||||
Unrealized (gain) loss on other investments (Corporate/All Other) | 395 | (2,439) | (181) | (1,645) | ||||||||||||||||||||||
Tax impact of unrealized (gain) loss on other investments | (83) | 512 | 38 | 345 | ||||||||||||||||||||||
| Adjusted Operating Results | $ | 87,274 | $ | 36,271 | $ | 393,073 | $ | 257,949 | ||||||||||||||||||
| Reported GAAP Earnings Per Share | $ | 0.95 | $ | (1.60) | $ | 3.97 | $ | (1.41) | ||||||||||||||||||
Items impacting comparability: | ||||||||||||||||||||||||||
Impairment of oil and gas properties, net of tax (E&P) | — | 2.02 | 0.60 | 3.71 | ||||||||||||||||||||||
Gain on sale of timber properties, net of tax (Corporate/All Other) | — | — | (0.40) | — | ||||||||||||||||||||||
| Premium paid on early redemption of debt, net of tax | — | — | 0.12 | — | ||||||||||||||||||||||
| Deferred tax valuation allowance | — | — | — | 0.65 | ||||||||||||||||||||||
Unrealized (gain) loss on other investments, net of tax (Corporate/All Other) | — | (0.02) | — | (0.01) | ||||||||||||||||||||||
| Earnings per share impact of diluted shares | — | — | — | (0.02) | ||||||||||||||||||||||
| Adjusted Operating Results Per Share | $ | 0.95 | $ | 0.40 | $ | 4.29 | $ | 2.92 | ||||||||||||||||||
Management defines Adjusted EBITDA as reported GAAP earnings before the following items: interest expense, income taxes, depreciation, depletion and amortization, other income and deductions, impairments, and other items reflected in operating income that impact comparability. The following tables reconcile National Fuel's reported GAAP earnings to Adjusted EBITDA for the three and twelve months ended September 30, 2021 and 2020:
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||||||||
| (in thousands) | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||
| Reported GAAP Earnings | $ | 86,962 | $ | (145,545) | $ | 363,647 | $ | (123,772) | ||||||||||||||||||
| Depreciation, Depletion and Amortization | 83,671 | 80,097 | 335,303 | 306,158 | ||||||||||||||||||||||
| Other (Income) Deductions | 160 | (159) | 15,238 | 17,814 | ||||||||||||||||||||||
| Interest Expense | 30,431 | 34,361 | 146,357 | 117,077 | ||||||||||||||||||||||
| Income Taxes | 14,720 | (62,636) | 114,682 | 18,739 | ||||||||||||||||||||||
| Impairment of Oil and Gas Producing Properties | — | 253,441 | 76,152 | 449,438 | ||||||||||||||||||||||
| Gain on Sale of Timber Properties | — | — | (51,066) | — | ||||||||||||||||||||||
| Adjusted EBITDA | $ | 215,944 | $ | 159,559 | $ | 1,000,313 | $ | 785,454 | ||||||||||||||||||
| Adjusted EBITDA by Segment | ||||||||||||||||||||||||||
| Pipeline and Storage Adjusted EBITDA | $ | 49,131 | $ | 46,966 | $ | 218,921 | $ | 189,520 | ||||||||||||||||||
| Gathering Adjusted EBITDA | 37,858 | 33,062 | 159,005 | 119,879 | ||||||||||||||||||||||
| Total Midstream Businesses Adjusted EBITDA | 86,989 | 80,028 | 377,926 | 309,399 | ||||||||||||||||||||||
| Exploration and Production Adjusted EBITDA | 120,588 | 75,439 | 464,529 | 312,166 | ||||||||||||||||||||||
| Utility Adjusted EBITDA | 11,093 | 8,550 | 171,379 | 171,418 | ||||||||||||||||||||||
| Corporate and All Other Adjusted EBITDA | (2,726) | (4,458) | (13,521) | (7,529) | ||||||||||||||||||||||
| Total Adjusted EBITDA | $ | 215,944 | $ | 159,559 | $ | 1,000,313 | $ | 785,454 | ||||||||||||||||||
Page 26.
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
NON-GAAP FINANCIAL MEASURES
SEGMENT ADJUSTED EBITDA
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||||||||
| (in thousands) | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||
| Exploration and Production Segment | ||||||||||||||||||||||||||
| Reported GAAP Earnings | $ | 55,703 | $ | (169,171) | $ | 101,916 | $ | (326,904) | ||||||||||||||||||
| Depreciation, Depletion and Amortization | 45,135 | 43,467 | 182,492 | 172,124 | ||||||||||||||||||||||
| Other (Income) Deductions | 254 | 280 | 937 | 882 | ||||||||||||||||||||||
| Interest Expense | 11,942 | 15,555 | 69,662 | 58,098 | ||||||||||||||||||||||
| Income Taxes | 7,554 | (68,133) | 33,370 | (41,472) | ||||||||||||||||||||||
| Impairment of Oil and Gas Producing Properties | — | 253,441 | 76,152 | 449,438 | ||||||||||||||||||||||
| Adjusted EBITDA | $ | 120,588 | $ | 75,439 | $ | 464,529 | $ | 312,166 | ||||||||||||||||||
| Pipeline and Storage Segment | ||||||||||||||||||||||||||
| Reported GAAP Earnings | $ | 21,482 | $ | 16,045 | $ | 92,542 | $ | 78,860 | ||||||||||||||||||
| Depreciation, Depletion and Amortization | 15,626 | 14,638 | 62,431 | 53,951 | ||||||||||||||||||||||
| Other (Income) Deductions | (2,305) | (307) | (5,840) | (4,635) | ||||||||||||||||||||||
| Interest Expense | 9,623 | 10,695 | 40,976 | 32,731 | ||||||||||||||||||||||
| Income Taxes | 4,705 | 5,895 | 28,812 | 28,613 | ||||||||||||||||||||||
| Adjusted EBITDA | $ | 49,131 | $ | 46,966 | $ | 218,921 | $ | 189,520 | ||||||||||||||||||
| Gathering Segment | ||||||||||||||||||||||||||
| Reported GAAP Earnings | $ | 18,597 | $ | 17,550 | $ | 80,274 | $ | 68,631 | ||||||||||||||||||
| Depreciation, Depletion and Amortization | 8,219 | 6,785 | 32,350 | 22,440 | ||||||||||||||||||||||
| Other (Income) Deductions | 62 | (275) | 12 | (260) | ||||||||||||||||||||||
| Interest Expense | 4,093 | 4,115 | 17,493 | 10,877 | ||||||||||||||||||||||
| Income Taxes | 6,887 | 4,887 | 28,876 | 18,191 | ||||||||||||||||||||||
| Adjusted EBITDA | $ | 37,858 | $ | 33,062 | $ | 159,005 | $ | 119,879 | ||||||||||||||||||
| Utility Segment | ||||||||||||||||||||||||||
| Reported GAAP Earnings | $ | (5,587) | $ | (6,969) | $ | 54,335 | $ | 57,366 | ||||||||||||||||||
| Depreciation, Depletion and Amortization | 14,646 | 14,007 | 57,457 | 55,248 | ||||||||||||||||||||||
| Other (Income) Deductions | 1,252 | 1,412 | 23,785 | 23,380 | ||||||||||||||||||||||
| Interest Expense | 5,337 | 5,720 | 21,795 | 22,150 | ||||||||||||||||||||||
| Income Taxes | (4,555) | (5,620) | 14,007 | 13,274 | ||||||||||||||||||||||
| Adjusted EBITDA | $ | 11,093 | $ | 8,550 | $ | 171,379 | $ | 171,418 | ||||||||||||||||||
| Corporate and All Other | ||||||||||||||||||||||||||
| Reported GAAP Earnings | $ | (3,233) | $ | (3,000) | $ | 34,580 | $ | (1,725) | ||||||||||||||||||
| Depreciation, Depletion and Amortization | 45 | 1,200 | 573 | 2,395 | ||||||||||||||||||||||
| Gain on Sale of Timber Properties | — | — | (51,066) | — | ||||||||||||||||||||||
| Other (Income) Deductions | 897 | (1,269) | (3,656) | (1,553) | ||||||||||||||||||||||
| Interest Expense | (564) | (1,724) | (3,569) | (6,779) | ||||||||||||||||||||||
| Income Taxes | 129 | 335 | 9,617 | 133 | ||||||||||||||||||||||
| Adjusted EBITDA | $ | (2,726) | $ | (4,458) | $ | (13,521) | $ | (7,529) | ||||||||||||||||||
Management defines free cash flow as funds from operations less capital expenditures. The Company is unable to provide a reconciliation of projected free cash flow as described in this release to its comparable financial measure calculated in accordance with GAAP without unreasonable efforts. This is due to our inability to calculate the comparable GAAP projected metrics, including operating income and total production costs, given the unknown effect, timing, and potential significance of certain income statement items.