Do you see CEV projects playing out more in the near term or towards the end of the year?

Management stated they are not changing their CapEx guidance and are continuing to move forward to hit those numbers, indicating a continuous process rather than a specific near-term or end-of-year focus. They reiterated that market pressures and the need for electric capacity in New Jersey are driving this forward. “I mean we're not changing our CapEx guidance. So we're still continuing to move forward to hit those numbers. So really, the things that I was talking about the pressure on the market developed and bringing more capacity to electric customers in New Jersey is moving forward and certainly an important part of the Shell Administration's goals of trying to lower electric.”

What fundamentally changed in Energy Services since February that led to the improved outlook and realization?

Management explained that the initial guidance raise in February occurred before much of the winter had fully transpired. The continued outperformance through February and March, and the subsequent conclusion of the winter season, allowed them to finalize the books and reflect the increased value in the current guidance raise. “Really, when we raised guidance back in February, that was previous period. So much of the winter had not transpired to that point. And through February and March, that book continues to increase in value and add value and conclusions of the winter, we're able to close the books and look at those numbers. And certainly the earnings guidance raise that you see here is reflective of that.”

When does the Leaf River expansion CapEx start, and will it require any additional financing, specifically equity or debt?

Management confirmed that capital expenditures for Leaf River are starting now, with commitments for equipment and contractors. They explicitly stated that no additional financing will be needed for Leaf River. The project is moving along schedule, with an environmental assessment received, and is expected in service in fiscal year 2027-2028, backed by a long-term contract. “So we won't need any additional financing for Leaf River, but capital expenditures are starting now. We started to make commitments on equipment and arrange for contractors and other things that begin that process of construction. You saw that we received the environmental assessment for FERC not too long ago. So everything is moving along as it should according to schedule.”

NJR

New Jersey Resources (NJR) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Mar 2026 (Q2 FY26)· Utilities· May 5, 2026

Source: earnings call transcript

Executive summary

New Jersey Resources Q2 FY26 — Strong Winter Performance Drives Raised EPS Guidance

New Jersey Resources reported strong Q2 FY26 results, driven by exceptional operational performance during a demanding winter, particularly from its Energy Services segment. This outperformance led to a second upward revision of the company's fiscal 2026 NFEPS guidance. The diversified business model, anchored by the regulated utility and supported by scaling clean energy and storage operations, continues to reinforce confidence in its long-term growth trajectory and financial strength.

Highlights

Energy Services outperformance led to a second raise in fiscal 2026 NFEPS guidance by an additional $0.20, to a range of $3.48 to $3.62 per share.
New Jersey Natural Gas (NJNG) delivered over $93 million in gross customer savings during the winter season through its basic gas supply service incentive program.
Clean Energy Ventures (CEV) brought 33 megawatts of new capacity into service this year, surpassing 500 megawatts of total in-service capacity.
Storage and Transportation (S&T) segment is on track to more than double its net financial earnings over the next two years.
NJNG continues to experience steady customer growth, including the formal inclusion of Chester Township in its regulated service territory.

Guidance & targets

Category	Target	Timeline	Confidence
Fiscal 2026 NFEPS	$3.48 to $3.62 per share high materiality	FY26	High
Storage and Transportation Net Financial Earnings	more than double medium materiality	next 2 years	High
Clean Energy Ventures Installed Capacity	additional 50% medium materiality	through the end of fiscal 2027 · FY27	High
Long-term NFE Growth Target	7% to 9% high materiality	long-term	High
Adjusted Debt-to-Capital Ratio	around 20% medium materiality	next 5 years	High
5-year CapEx Outlook	$4.8 billion to $5.2 billion high materiality	through fiscal 2030 · FY30	High

Segment performance

Segment	Revenue	YoY	QoQ	Margin
New Jersey Natural Gas Experienced highest send-out days in history, delivered safe and reliable service during demanding winter. Proactively managed gas costs, securing significant winter supply. Continues to see steady customer growth, including expansion into Chester Township. Projected gas supply requirements hedged: >87%Average hedge price: $3.27 per dekathermGross customer savings (winter season): $93 millionTotal gross customer savings (program life): $1.6 billionCustomers in SAVEGREEN program: >115,000Bill savings for whole home offerings: up to 30%	—	—	—	—
Storage and Transportation On track to more than double NFE over the next two years, driven by strong recontracting activity at Adelphia Gateway and Leaf River with fixed-price, fee-based agreements. Leaf River expansion progressing with FERC application and environmental accession, backed by a long-term contract. Expected NFE growth: more than double over next 2 yearsLeaf River working gas capacity increase proposed: >70%	—	—	—	—
Clean Energy Ventures Continued momentum with new capacity brought into service, surpassing 500 MW total. Positioned for strong investment returns (high single to low double-digit unlevered after-tax). Exploring optimization of existing solar sites with new technologies and leveraging PJM interconnections. Utilizes sale leasebacks and considering tax credit transferability. Installed capacity increase (FY25): almost 25%New capacity brought into service (this year): 33 megawattsTotal in-service capacity: >500 megawattsExpected installed capacity increase (through FY27): additional 50%Project pipeline: >1.2 gigawatts	—	—	—	—

Orderbook & backlog

Clean Energy Ventures Project Pipeline >1.2 gigawatts Q2 FY26

Diverse project pipeline that grants the right, but not the obligation to invest; well in excess of capital deployment targets.

Leaf River Proposed Working Gas Capacity Increase >70% Q2 FY26

Proposed increase in working gas capacities over the next few years, filed in a FERC application.

Deals & partnerships

Chester Township Inclusion in regulated service territory

Chester Township in Morris County is now formally included in New Jersey Natural Gas' regulated service territory, reflecting a partnership with communities and regulators to expand footprint.

Undisclosed Long-term contract for Leaf River expansion long-term

Secured a long-term contract supporting the initial expansion at existing Leaf River caverns, with remaining phases to be underpinned by similar contracts.

Capital programs

5-year Capital Expenditure Outlook underway $4.8 billion to $5.2 billion

Period spend: $400 million

Reaffirmed 5-year CapEx outlook through fiscal 2030. Approximately $400 million deployed year-to-date. More than 60% of this capital is expected to be invested in the utility segment, with Clean Energy Ventures and Storage and Transportation comprising the balance.

Leaf River Expansion underway

Start: Q2 FY26

Benefit:increase working gas capacities by more than 70%

Capital expenditures are starting now with commitments on equipment and contractors. Received environmental accession from FERC. Initial expansion backed by a long-term contract. No additional financing needed.

What to watch in Q3 FY26

Leaf River Expansion Progress

next quarter / FY27-28

Current FERC environmental accession received, CapEx starting

Target Further regulatory approvals, construction milestones, progress towards FY27-28 in-service date

Why it matters

This expansion is a key driver for the Storage and Transportation segment's expected doubling of NFE over the next two years.

Moving to longer-term growth at Leaf River, we continue to make steady progress on our expansion plans. During the first quarter, we filed a FERC application in which we proposed increasing working gas capacities by more than 70% over the next few years. We recently received the environmental accession from FERC which represents another important step in the review process, and the filing is progressing as expected.

Find out whether NJR delivers this. Inve re-checks your case every morning.

Q&A highlights

Can you provide more color on solar project opportunities for CEV and the outreach from PJM and the state, especially concerning New Jersey's generation gap?

Management confirmed that the situation is playing out as expected, with a 1.2 gigawatt pipeline of projects available. New Jersey is encouraging development due to PJM capacity shortfalls, and solar offers the quickest path to bring new capacity to market. They are continuing to make investments in this space.

“Really, it's been playing out just like we said all along, we see [ harbor ] a number of projects. We've got a 1.2 gigawatt number of projects available to us and the state has been certainly encouraging for development with the capacity shortfalls in PJM, the quickest way to bring new capacity to market is through solar.”

asked by Dylan Lipner · answered by Stephen D. Westhoven

2 min read 6 chapters

Detailed narrative

Record Winter Performance and Reliability

New Jersey Resources reported excellent Q2 FY26 results during one of the most demanding winter periods in recent years, with sustained freezing temperatures in the Northeast. New Jersey Natural Gas (NJNG) experienced its highest send-out days in history, while Storage & Transportation (S&T) assets like Adelphia Gateway operated at maximum capacity and Leaf River saw withdrawals exceeding Winter Storm year 2021 levels.

This performance underscored the effectiveness of the company's infrastructure, planning, and operations in delivering safe, reliable service.

Customer Affordability and Savings Initiatives

NJNG demonstrated a proactive approach to managing gas costs, hedging over 87% of winter gas supply at an average price of approximately $3.27 per dekatherm, significantly below Citygate prices that traded in excess of $135 per dekatherm. This strategy, combined with the state-approved basic gas supply service incentive program, generated over $93 million in gross customer savings during the winter season, contributing to over $1.6 billion in total savings over the program's life.

The SAVEGREEN program also helped over 115,000 customers achieve bill savings of up to 30%.

Regulated Utility Growth and Expansion

The cost advantage of natural gas continues to drive steady customer growth across NJNG's service territory, fueled by new construction, conversions, and targeted infrastructure expansion. A recent example is the formal inclusion of Chester Township in Morris County into NJNG's regulated service territory, reflecting successful partnerships with communities and regulators to thoughtfully expand the company's footprint while maintaining safe and reliable service.

Storage & Transportation Segment Progress

The Storage and Transportation segment is on track to more than double its net financial earnings over the next two years, driven by strong recontracting activity at Adelphia Gateway and Leaf River, characterized by fixed-price, fee-based agreements with high-quality counterparties.

Leaf River's expansion plans are progressing, with a FERC application filed to increase working gas capacities by over 70% and the recent receipt of environmental accession. The initial expansion is already underpinned by a long-term contract, with further phases expected to be similarly secured.

Clean Energy Ventures Scaling and Innovation

Clean Energy Ventures (CEV) continues its growth momentum, increasing installed capacity by 33 megawatts this year and surpassing 500 megawatts of in-service capacity. The company anticipates an additional 50% increase in installed capacity through fiscal 2027, supported by a diverse project pipeline exceeding 1.2 gigawatts.

CEV is also exploring leveraging its operational assets and existing PJM interconnections with technologies like linear generators, fuel cells, and batteries to optimize sites and benefit from investment tax credits into the 2030s.

Financial Strength and Capital Investment

NJR deployed approximately $400 million of capital year-to-date, with New Jersey Natural Gas accounting for roughly two-thirds of the spending. The company reaffirmed its 5-year CapEx outlook of $4.8 billion to $5.2 billion through fiscal 2030, with over 60% allocated to the utility.

Strong financial performance, particularly from Energy Services, enhances the ability to fund capital investments and maintain robust credit metrics, with management stating no need for block equity in the foreseeable future.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.