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    UTL
    Earnings call· Jun 2026(Q2 FY26)

    UNITIL Q2 FY26 earnings call UTL

    Aug 4, 2026 Source

    Executive summary

    Unitil Corporation Q2 FY26 — Strong H1 Performance and Strategic Acquisitions

    Unitil reported strong financial and operational performance in Q2 FY26, driven by higher rates and customer growth, and reaffirmed its full-year and long-term EPS guidance. The company successfully closed the acquisition of two New Hampshire water utilities and is progressing with rate cases in Maine and New Hampshire, while also seeing increased interest in natural gas conversions.

    Highlights

    5

    • Adjusted net income for H1 FY26 was $39 million, or $2.17 per share, an increase of $0.14 or nearly 7% compared to H1 FY25.

    • GAAP return on equity was 9.6% on a trailing 12-month basis, fully earning authorized returns.

    • Acquisition of Aquarian Water Company of New Hampshire and Abenaki Water Company successfully closed for $55.8 million.

    • Overall customer satisfaction remains high at 90%, ranking best among Northeast utilities and within the top quartile nationally.

    • Natural gas customer inquiries increased 50% year-over-year, with 1,500 new customers under contract or in construction.

    Concerns

    1

    • Regulatory process for Massachusetts Aquarian acquisition

    Guidance & targets

    2
    CategoryTargetConfidence
    Adjusted EPS
    $3.20 to $3.36 per share
    high materiality
    High
    Long-term EPS growth rate
    5% to 7%
    high materiality
    High

    Operational metrics

    19
    Adjusted net income
    $5.2 million
    Q2 FY26
    Adjusted EPS
    $0.29
    Q2 FY26
    Adjusted net income
    $39 million$5.9 million increase
    H1 FY26
    Adjusted EPS
    $2.17up $0.14 or nearly 7%
    H1 FY26
    GAAP Return on Equity
    9.6%
    TTM
    Electric adjusted gross margin
    $61.2 millionincrease of $7.9 million, or 14.8%
    H1 FY26

    Driven by higher rates and customer growth, supported by $13 million permanent rate award in New Hampshire and performance-based rate adjustments in Fitchburg.

    Gas adjusted gross margin
    $122.7 millionincrease of $14.6 million, or approximately 13.5%
    H1 FY26

    Reflects contribution from Maine Natural Gas ($8.7 million), higher rates and customer growth ($4.5 million), and colder winter weather ($1.4 million).

    New gas customers added
    6,600compared to the same period in 2025
    H1 FY26
    Gas customers under decoupled rates
    52%
    as of June 30, 2026
    O&M expenses (excluding Maine Natural Gas)
    $0.6 millionincrease, or just above 1%
    H1 FY26

    Well below the increase in inflation over the same period.

    FFO to debt (S&P adjusted)
    17.2%
    most recent

    Squarely in the middle of long-term target and well above downgrade thresholds.

    Equity issued under ATM program
    $11 million
    Q2 FY26
    Available capacity under ATM program
    $37.5 million
    end Q2 FY26
    Customer satisfaction
    90%slightly better than last year
    recent survey
    AMI project cost
    $10 million
    completed last year

    Currently being recovered in rates.

    AMI meters replaced
    21,000
    to date
    Natural gas customer inquiries
    50%increase compared to same period last year
    H1 FY26
    Rate base increase
    $200 million14.9%
    YoY
    Rate base growth (average)
    9.5%above long-term range of 6.5%-8.5%
    past 5 years

    Industry KPIs

    6
    MetricValueDetails
    Adjusted operating EPS$0.29USD
    Multi year capital plan$1.2 billionUSD
    Regulatory rate base growth14.9%%
    Allowed ROE equity layer rate casesNew Hampshire: $9.8 million permanent rate increase filed; $5.5 million temporary rates took effect June 1st. Maine: $10.4 million revenue increase proposed.USD
    Combined electric gas framework mandates52%%
    Major regulated project construction progress21,000 meters replacedmeters

    Orderbook & backlog

    1
    New natural gas customers under contract or in construction1,500Q2 FY26

    Deals & partnerships

    2
    Aquarian Water Company of New Hampshire and Abenaki Water CompanyAcquisition of two regulated distribution water utilities.$55.8 million

    Includes assumption of $13.7 million of long-term debt. Initially financed with holding company term loan. Entered into a five-year operating and transition services agreement with Aquarian Water Authority.

    Eversource EnergyNon-binding letter of intent to purchase the Massachusetts Aquarian Company.

    Pending satisfaction of certain conditions, including the successful resolution of a base rate case proceeding.

    Capital programs

    2
    Five-year capital investment planunderway$1.2 billion
    Funding: cash flow from operations supplemented by long-term debt and equity

    Benefit: Includes $65 million for Bangor Natural Gas and Maine Natural Gas, and $33 million for New Hampshire Water Companies.

    This plan represents an increase of 24% over the previous five-year plan.

    Advanced Metering Infrastructure (AMI) projectunderway$30 million
    Spent to date: 21,000 meters replaced

    Benefit: 59,000 meters remaining to be replaced; state-of-the-art smart meters providing near real-time information and grid optimization.

    Portion of the amount included in the company's next step adjustment.

    Risks & headwinds

    1
    Regulatory process for Massachusetts Aquarian acquisition

    Drawn out regulatory process

    Mitigation: Eversource Energy is expected to file a rate case to address conditions (stay-out, gain on sale of Hingham assets).

    What to watch in Q3 FY26

    5

    New Hampshire Northern Utilities rate case progress

    early 2027
    CurrentTechnical sessions underway, intervener testimony due November 2026, settlement conferences scheduled for early 2027.
    TargetProgress towards settlement conferences and permanent rates taking effect April 1, 2027.

    Why it matters

    The outcome of this rate case will significantly impact future revenues and earnings for the New Hampshire electric subsidiary.

    Starting with New Hampshire, on April 1st, we filed for a permanent rate increase of $9.8 million, and on June 1st, temporary rates of $5.5 million took effect. We have proposed a multi-year rate plan with two-step adjustments to recover all 2026 and 2027 system investments. The rate proposal also includes the continuation of revenue decoupling, but similar to our New Hampshire Electric Company, we have proposed a decoupling methodology change from a revenue per customer model to a total authorized revenue target. We are currently participating in technical sessions and intervener testimony is due in November. Settlement conferences are currently scheduled for early 2027, with permanent rates expected to go into effect on April 1, 2027.

    Q&A highlights

    3

    The analyst asked about the EPS neutrality of the Aquarian acquisition, specifically if the comment assumed both New Hampshire and Massachusetts acquisitions, and how the New Hampshire-only closure affects the outlook. They also inquired about the status and next steps for the Massachusetts Aquarian acquisition.

    Management confirmed that the incremental CapEx referenced only relates to the New Hampshire Aquarian Companies and that their earnings contribution is expected to be neutral to consolidated EPS after financing. For Massachusetts, Eversource Energy is expected to file a rate case to address conditions from the previous approval order, including a stay-out and dealing with the gain on sale of Hingham assets.

    “Andrew, you're correct. The amount of incremental CapEx that we referenced in the slides only relates to the New Hampshire Aquarium Companies. And just based on the New Hampshire Aquarium Companies results for the rest of the year, we would expect the earnings contribution from those companies to be neutral to consolidated EPS.”

    asked by Andrew Weasel from Scotiabank · answered by Unknown Speaker

    2 min read5 chapters

    Detailed Narrative

    01

    Q2 FY26 Financial Performance

    Unitil reported adjusted net income of $5.2 million, or $0.29 per share, for Q2 FY26. For the first half of 2026, adjusted net income reached $39 million, or $2.17 per share, marking a $0.14 or nearly 7% increase compared to the same period in 2025. The company is fully earning its authorized returns, with a GAAP return on equity of 9.6% on a trailing 12-month basis.

    02

    Strategic Acquisitions and Regulatory Agenda

    The acquisition of Aquarian Water Company of New Hampshire and Abenaki Water Company successfully closed on June 30th for a total purchase price of $55.8 million, including $13.7 million in assumed debt. This acquisition is expected to be earnings neutral in 2026 and accretive once new distribution rates take effect. Additionally, Unitil has a non-binding letter of intent to purchase the Massachusetts Aquarian Company from Eversource Energy, pending a base rate case resolution. Regulatory proceedings for Northern Utilities in Maine and New Hampshire are progressing as expected.

    03

    Customer Satisfaction and AMI Project Update

    Customer satisfaction remains a high priority, with overall satisfaction at 90%, which is slightly better than the previous year and positions Unitil as best among Northeast utilities and within the top quartile nationally. The Advanced Metering Infrastructure (AMI) project in Massachusetts was completed last year, replacing 31,000 meters at a cost of approximately $10 million. In New Hampshire, 21,000 meters have been replaced, with the remaining 59,000 expected to be completed by the end of 2027, at an estimated total cost of $30 million.

    04

    Natural Gas Conversion Opportunities

    Natural gas continues to hold a significant price advantage over competing fuels like oil and propane, particularly in Maine where a high percentage of homes use more expensive alternatives. This has led to a 50% increase in customer inquiries for natural gas service year-over-year, with 1,500 new customers currently under contract or in construction. The company also noted growth in adjusted margin across all natural gas companies compared to 2025, supported by fuel choice statutes in Maine and New Hampshire.

    05

    Capital Investment and Balance Sheet Management

    Unitil's current five-year capital investment plan through 2030 totals approximately $1.2 billion, representing a 24% increase over the previous plan. This includes $65 million for Bangor Natural Gas and Maine Natural Gas, and $33 million for the New Hampshire Water Companies. The company maintains a strong balance sheet with an S&P adjusted FFO to debt metric of 17.2%, well within its long-term target. Equity issuance under the ATM program totaled $11 million in Q2, with $37.5 million capacity remaining.

    AI-generated summary of the company’s earnings call. Not investment advice.