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National Fuel Reports Fourth Quarter and Full Year Fiscal 2023 Earnings

WILLIAMSVILLE, N.Y., Nov. 01, 2023 (GLOBE NEWSWIRE) -- 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, 2023.

FISCAL 2023 FOURTH QUARTER SUMMARY

  • GAAP net income of $73.7 million, or $0.80 per share, compared to GAAP net income of $158.1 million, or $1.71 per share, in the prior year.
  • Adjusted operating results of $72.2 million, or $0.78 per share, compared to $109.3 million, or $1.19 per share, in the prior year (see non-GAAP reconciliation on page 2 for fourth quarter and fiscal 2023).
  • Both E&P segment net production and Gathering segment revenue increased by 7% versus the prior year, driven by continued strong operational execution in Appalachia.
  • Supply Corporation entered into a precedent agreement with Seneca for its Tioga Pathway Project, which is an estimated $90 million modernization and expansion project that will add 190,000 Dth per day of firm transportation takeaway capacity from northwest Tioga County, Pennsylvania.

FISCAL 2023 HIGHLIGHTS

  • Generated consolidated net cash provided by operating activities of $1.24 billion for fiscal 2023, with free cash flow of $275 million (see non-GAAP reconciliation on page 27 for fiscal 2023).
  • Increased the shareholder dividend for the 53rd consecutive year to an annual rate of $1.98 per share, an increase of 4.2%, continuing the Company’s long history of consistently returning capital to shareholders.
  • Distribution Corporation settled a rate proceeding in Pennsylvania, which will increase annual base rate delivery revenues by $23 million.
  • Seneca Resources bolstered its deep inventory of highly economic development locations in its Eastern Development Area with the acquisition of approximately 39,000 net acres in Tioga and Lycoming counties.
  • NFG Midstream achieved certification of 100% of its assets under Equitable Origin’s EO100TM Standard for Responsible Energy Development, becoming the first gathering or midstream company to receive this ESG-focused certification.

MANAGEMENT COMMENTS

David P. Bauer, President and Chief Executive Officer of National Fuel Gas Company, stated: “Despite the headwinds of lower natural gas prices in fiscal 2023, National Fuel delivered strong results, both financially and operationally. As we move into fiscal 2024, the combination of a strong outlook for long-term growth in our regulated businesses, increasing capital efficiency in our non-regulated operations, and expectations of improving natural gas price realizations position us well to deliver long-term value to 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) 2023   2022   2023   2022 
Reported GAAP Earnings$        73,677  $        158,143  $        476,866  $        566,021 
Items impacting comparability:       
Unrealized (gain) loss on derivative asset (E&P)         (2,803)          4,395           899           4,395 
Tax impact of unrealized (gain) loss on derivative asset         775           (1,203)          (240)          (1,203)
Unrealized (gain) loss on other investments (Corporate / All Other)         719           1,532           (913)          11,625 
Tax impact of unrealized (gain) loss on other investments         (151)          (322)          192           (2,441)
Reversal of deferred tax valuation allowance         —           (24,850)          —           (24,850)
Remeasurement of deferred income taxes from Pennsylvania state income tax rate reduction         —           (28,406)          —           (28,406)
Items impacting comparability from West Coast asset sale (E&P) (1)         —           —           —           41,589 
Tax impact of items impacting comparability from West Coast asset sale (1)         —           —           —           (10,533)
Reduction of other post-retirement regulatory liability (Utility)         —           —           —           (18,533)
Tax impact of reduction of other post-retirement regulatory liability         —           —           —           3,892 
Adjusted Operating Results$        72,217  $        109,289  $        476,804  $        541,556 
        
Reported GAAP Earnings Per Share$        0.80  $        1.71  $        5.17  $        6.15 
Items impacting comparability:       
Unrealized (gain) loss on derivative asset, net of tax (E&P)         (0.02)          0.03           0.01           0.03 
Unrealized (gain) loss on other investments, net of tax (Corporate / All Other)         0.01           0.01           (0.01)          0.10 
Reversal of deferred tax valuation allowance         —           (0.27)          —           (0.27)
Remeasurement of deferred income taxes from Pennsylvania state income tax rate reduction         —           (0.31)          —           (0.31)
Items impacting comparability from West Coast asset sale, net of tax (E&P) (1)         —           —           —           0.34 
Reduction of other post-retirement regulatory liability, net of tax (Utility)         —           —           —           (0.16)
Rounding         (0.01)          0.02           —           — 
Adjusted Operating Results Per Share$        0.78  $        1.19  $        5.17  $        5.88 


(1)Refer to non-GAAP reconciliation on page 24 for a separate breakout of items impacting comparability from the West Coast asset sale.
  

FISCAL 2024 GUIDANCE UPDATE

National Fuel is revising its fiscal 2024 earnings guidance to reflect updated forecast assumptions and projections since the Company’s preliminary guidance range was announced in August 2023. The Company is now projecting that earnings will be within the range of $5.40 to $5.90 per share, an increase of 9% from the Company’s 2023 adjusted operating results at the midpoint of the updated 2024 guidance range.

Consistent with preliminary guidance, the Company is assuming that NYMEX natural gas prices will average $3.25 per MMBtu for the fiscal year. For guidance purposes, the Company’s updated natural gas price projections approximate the current NYMEX forward curve and consider the impact of local sales point differentials and new physical firm sales, transportation, and financial hedge contracts.

Seneca currently has firm sales contracts in place for approximately 89% of its projected fiscal 2024 Appalachian production, limiting its exposure to in-basin markets. Approximately 69% of Seneca’s expected Appalachian production is either matched by a financial hedge, including a combination of swaps and no-cost collars, or was entered into at a fixed price. Seneca’s depreciation, depletion and amortization guidance range was also revised to reflect current expectations for the fiscal year.

The Company’s consolidated and individual segment capital expenditures guidance remain unchanged from the preliminary guidance. Other guidance assumptions remain largely unchanged from the previous guidance. The details are outlined in the table on page 7.

DISCUSSION OF FOURTH QUARTER RESULTS BY SEGMENT

The following earnings discussion of each operating segment for the quarter ended September 30, 2023 is summarized in a tabular form on pages 8 and 9 of this report (earnings drivers for the fiscal years ended September 30, 2023 are summarized on pages 10 and 11). 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 primarily natural gas reserves in Pennsylvania.

 Three Months Ended
 September 30
(in thousands) 2023   2022  Variance
GAAP Earnings$        36,772  $        116,077  $        (79,305)
Unrealized (gain) loss on derivative asset, net of tax         (2,028)          3,192           (5,220)
Reversal of deferred tax valuation allowance         —           (28,589)          28,589 
Remeasurement of deferred income tax from Pennsylvania state income tax rate reduction         —           (16,152)          16,152 
Adjusted Operating Results$        34,744  $        74,528  $        (39,784)
      
Adjusted EBITDA$        132,641  $        166,238  $        (33,597)


Seneca’s fourth quarter GAAP earnings decreased $79.3 million versus the prior year. Excluding several items impacting comparability as described below, Seneca's earnings decreased $39.8 million, with higher natural gas production more than offset by lower realized natural gas prices, higher operating expenses and higher income tax expense.

Last year’s fourth quarter earnings included two one-time items related to state deferred income taxes that impacted comparability as shown in the table above. These items consisted of a reversal of a $28.6 million valuation allowance on deferred tax assets related to certain state net operating loss and credit carryforwards, along with a $16.2 million benefit from the remeasurement of state deferred income taxes related to a series of reductions in the Pennsylvania state corporate income tax rate that was signed into law in July 2022. Earnings were also impacted by an unrealized gain of $2.8 million ($2.0 million after-tax) recognized during the current-year fourth quarter related to an increase in the fair value of the contingent consideration Seneca received in connection with the June 2022 divestiture of its California assets. In the prior-year's fourth quarter, Seneca recorded an unrealized loss of $4.4 million ($3.2 million after-tax) on that contingent consideration.

During this year's fourth quarter, Seneca produced 93.8 Bcfe, an increase of 5.9 Bcfe, or 7%, from the prior year, despite the impact of approximately 2 Bcfe of price-related curtailments due to low in-basin pricing.

Seneca’s average realized natural gas price, after the impact of hedging and transportation costs, was $2.33 per Mcf, a decrease of $0.51 per Mcf from the prior year. Lower natural gas prices, before the impact of hedging, were partially offset by an increase in the weighted average hedge price compared to the prior-year fourth quarter.

On a per unit basis, lease operating and transportation expense (“LOE”) was $0.69 per Mcfe, a decrease of $0.02 per Mcfe from the prior year. On an absolute basis, LOE increased $1.7 million primarily due to higher water management costs, partially offset by lower rental and workover expenses. An increase in transportation and gathering costs as a result of increased production also contributed to the increase in absolute LOE. LOE includes $51.2 million for gathering and compression services from NFG Midstream to connect Seneca’s production to sales points along interstate pipelines.

General and administrative (“G&A”) expense remained flat at $0.18 per Mcfe compared to the prior year. On an absolute basis, Seneca’s G&A expense increased $1.5 million primarily due to an increase in labor-related costs.

Depreciation, depletion and amortization (“DD&A”) expense was $0.71 per Mcfe, an increase of $0.11 per Mcfe from the prior year.  Absolute DD&A expense increased $13.4 million due to higher natural gas production and a higher per unit DD&A rate. The higher rate was driven by an increase in Seneca's full cost pool due to a combination of higher capitalized costs and an increase in estimated future development costs related to proved undeveloped wells.

Other taxes decreased $1.7 million largely attributable to lower Impact Fees in Pennsylvania due to the decline in NYMEX natural gas prices.

Excluding the impact of last year’s fourth quarter one-time items impacting comparability shown in the table above, the increase in Seneca’s effective tax rate was primarily driven by higher state income tax expense.

Proved Reserves Year-End Update

Seneca’s total proved reserves at September 30, 2023 were 4,536 Bcfe, an increase of 364 Bcfe, or 9%, from September 30, 2022. Seneca’s proved developed reserves at the end of fiscal 2023 were 3,551 Bcfe, representing 78% of total proved reserves, compared to 79% a year ago. In fiscal 2023, Seneca added 670 Bcfe of proved reserve extensions and discoveries, 34 Bcfe of proved developed reserves as a result of two separate upstream asset purchases during fiscal 2023, and 32 Bcfe of net positive revisions due primarily to improvements in well performance and changes in development plans. Seneca replaced 198% of its fiscal 2023 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) 2023   2022  Variance
GAAP Earnings$        23,354  $        25,320  $        (1,966)
      
Adjusted EBITDA$        56,236  $        59,819  $        (3,583)


The Pipeline and Storage segment’s fourth quarter GAAP earnings decreased $2.0 million versus the prior year primarily due to lower operating revenues, partially offset by an increase in other income. The decrease in operating revenues of $3.7 million was primarily attributable to contract expirations that occurred earlier in the fiscal year, partially offset by an increase in new short-term contracts. The increase in other income of $1.1 million was primarily attributable to a higher weighted average interest rate on intercompany short-term notes receivable.

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 delivers Seneca and other non-affiliated Appalachian production to the interstate pipeline system.

 Three Months Ended
 September 30
(in thousands) 2023   2022  Variance
GAAP Earnings$        26,517  $        31,224  $        (4,707)
Reversal of deferred tax valuation allowance         —           3,739           (3,739)
Remeasurement of deferred income tax from Pennsylvania state income tax rate reduction         —           (11,856)          11,856 
Adjusted Operating Results$        26,517  $        23,107  $        3,410 
      
Adjusted EBITDA$        46,874  $        43,335  $        3,539 


The Gathering segment’s fourth quarter GAAP earnings decreased $4.7 million versus the prior year. Similar to our Exploration and Production segment, last year’s fourth quarter earnings included two one-time items impacting comparability shown in the table above related to state deferred income taxes that did not recur this year. Excluding these items, the Gathering segment’s earnings increased $3.4 million primarily due to higher operating revenues. Operating revenues increased $3.9 million, or 7%, which was the result of a 12.6 Bcf increase in gathered volumes due to an increase in natural gas throughput from both non-affiliated parties and Seneca.

Downstream Business

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) 2023   2022  Variance
GAAP Earnings$        (7,179) $        (10,852) $        3,673 
      
Adjusted EBITDA$        6,693  $        6,270  $        423 


The Utility segment’s fourth quarter GAAP net loss was $3.7 million lower than the net loss in the prior year’s fourth quarter due to higher customer margins (operating revenues less purchased gas sold), a decrease in non-service pension and OPEB costs, higher other income and lower income tax expense, partially offset by increases in operation and maintenance (“O&M”) expense and interest expense.

The increase in customer margin of $1.6 million was due primarily to the implementation of the recent Pennsylvania rate case settlement, which increased base rates by $23 million annually, effective August 1, 2023. Also contributing to the increase were adjustments related to certain regulatory rate and cost recovery mechanisms subject to annual reconciliation and higher revenues from the Company’s system modernization tracking mechanisms in its New York service territory. These increases were partially offset by a $1.1 million reduction in base rates in New York, which, consistent with prior quarters, was the result of a rate proceeding that temporarily reduced the Utility’s recovery of pension and other post-employment benefit (“OPEB”) expenses to zero effective October 1, 2022. In addition to lowering rates, the proceeding mandated a corresponding decrease in pension and OPEB expenses, most of which had been previously recorded in “below the line” non-service pension and OPEB costs.

The increase in other income of $1.0 million was primarily attributable to interest earned on deferred gas costs. O&M expense increased by $1.7 million, primarily driven by higher labor-related costs. Interest expense increased $1.0 million due to the Company’s long-term debt issuance in May 2023.

Corporate and All Other

The Company’s operations that are included in Corporate and All Other generated a combined net loss of $5.8 million in the current year fourth quarter, which was $2.2 million higher than the combined net loss of $3.6 million in the prior-year fourth quarter. The increase in net loss was primarily driven by higher O&M expense as a result of an increase in professional services, which was partially offset by a lower amount of unrealized losses on investment securities recognized in the current quarter as compared to the prior-year fourth quarter.

EARNINGS TELECONFERENCE

The Company will host a conference call on Thursday, November 2, 2023, at 10 a.m. Eastern Time to discuss this announcement. To pre-register for the call (recommended), please visit https://www.netroadshow.com/events/login?show=2be14adf&confId=56623. After registering, you will receive your access details via email. To join by telephone on the day of the call, dial U.S. toll free 1-833–470–1428 and provide Participant Access Code 568657. The teleconference will also be simultaneously webcast online and can be accessed on the NFG Investor Relations website at investor.nationalfuelgas.com. A telephone replay of the teleconference call will be available through the end of the day on Thursday, November 9, 2023. To access the replay, dial U.S. toll free 1-866-813-9403 and provide Replay Access Code 693074.

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. Haspett716-857-7697
Media Contact:Karen L. Merkel716-857-7654
   
   

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; changes in economic conditions, including inflationary pressures, supply chain issues, liquidity challenges, and 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; 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 reserves; increased costs or delays or changes in plans with respect to Company projects or related projects of other companies, 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; changes in price differentials between similar quantities of natural gas 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 reserves, including among others geology, lease availability and costs, 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 having different quality, heating value, hydrocarbon mix or delivery date; the cost and effects of legal and administrative claims against the Company or activist shareholder campaigns to effect changes at the Company; negotiations with the collective bargaining units representing the Company's workforce, including potential work stoppages during negotiations; uncertainty of natural gas reserve estimates; significant differences between the Company’s projected and actual production levels for natural gas; changes in demographic patterns and weather conditions (including those related to climate change); 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, as well as economic and operational disruptions due to third-party outages; 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.

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
 
GUIDANCE SUMMARY


As discussed on page 2, the Company is revising its earnings guidance for fiscal 2024. 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 a derivative asset and unrealized gain or loss on investments during the fiscal year ending September 30, 2024, 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.

 Previous FY 2024 Guidance Updated FY 2024 Guidance
Adjusted Consolidated Earnings per Share, excluding items impacting comparability$5.50 to $6.00 $5.40 to $5.90
Consolidated Effective Tax Rate~ 25.5 - 26% ~ 25 - 25.5%
    
Capital Expenditures (Millions)   
Exploration and Production$525 - $575 $525 - $575
Pipeline and Storage$120 - $140 $120 - $140
Gathering$90 - $110 $90 - $110
Utility$130 - $150 $130 - $150
Consolidated Capital Expenditures$865 - $975 $865 - $975
    
Exploration & Production Segment Guidance   
    
Commodity Price Assumptions   
NYMEX natural gas price$3.25 /MMBtu $3.25 /MMBtu
Appalachian basin spot price$2.45 /MMBtu $2.40 - $2.45 /MMBtu
    
Production (Bcfe)390 to 410 390 to 410
    
E&P Operating Costs ($/Mcfe)   
LOE$0.69 - $0.71 $0.69 - $0.71
G&A$0.17 - $0.19 $0.17 - $0.19
DD&A$0.66 - $0.70 $0.69 - $0.74
    
Other Business Segment Guidance (Millions)   
Gathering Segment Revenues$240 - $260 $240 - $260
Pipeline and Storage Segment Revenues$380 - $420 $380 - $420


 
NATIONAL FUEL GAS COMPANY
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS
QUARTER ENDED SEPTEMBER 30, 2023
(Unaudited)
            
 Upstream Midstream Downstream    
            
 Exploration & Pipeline &     Corporate /  
(Thousands of Dollars)Production Storage Gathering Utility All Other Consolidated*
            
Fourth quarter 2022 GAAP earnings$        116,077  $        25,320  $        31,224  $        (10,852) $        (3,626) $        158,143 
Items impacting comparability:           
Unrealized gain (loss) on derivative asset         4,395                   4,395 
Tax impact of unrealized gain (loss) on derivative asset         (1,203)                  (1,203)
Reversal of deferred tax valuation allowance         (28,589)    3,739               (24,850)
Remeasurement of deferred income taxes from Pennsylvania state income tax rate reduction         (16,152)            (11,856)            (398)          (28,406)
Unrealized (gain) loss on other investments                 1,532           1,532 
Tax impact of unrealized (gain) loss on other investments                 (322)          (322)
Fourth quarter 2022 adjusted operating results         74,528           25,320           23,107           (10,852)          (2,814)          109,289 
Drivers of adjusted operating results**           
Upstream Revenues           
Higher (lower) natural gas production         13,121                   13,121 
Higher (lower) realized natural gas prices, after hedging         (37,374)                  (37,374)
Higher (lower) other operating revenues         (734)                  (734)
Midstream Revenues           
Higher (lower) operating revenues           (2,932)          3,108               176 
Downstream Margins***           
Impact of usage and weather               (386)            (386)
Impact of new rates in Pennsylvania               754             754 
Impact of new rates in New York****               (893)            (893)
System modernization and improvement tracker revenues               366             366 
Regulatory revenue adjustments               1,951             1,951 
Operating Expenses           
Lower (higher) lease operating and transportation expenses         (1,352)                  (1,352)
Lower (higher) operating expenses         (1,500)            (314)          (1,586)          (2,800)          (6,200)
Lower (higher) property, franchise and other taxes         1,343                   1,343 
Lower (higher) depreciation / depletion         (10,614)          (529)          (359)          (679)            (12,181)
Other Income (Expense)           
(Higher) lower other deductions           815             1,192           (276)          1,731 
(Higher) lower interest expense         (627)            531           (998)          1,283           189 
Income Taxes           
Lower (higher) income tax expense / effective tax rate         (1,900)          474           402           3,648           (367)          2,257 
All other / rounding         (147)          206           42           304           (245)          160 
Fourth quarter 2023 adjusted operating results         34,744           23,354           26,517           (7,179)          (5,219)          72,217 
Items impacting comparability:           
Unrealized gain (loss) on derivative asset         2,803                   2,803 
Tax impact of unrealized gain (loss) on derivative asset         (775)                  (775)
Unrealized gain (loss) on other investments                 (719)          (719)
Tax impact of unrealized gain (loss) on other investments                 151           151 
Fourth quarter 2023 GAAP earnings$        36,772  $        23,354  $        26,517  $        (7,179) $        (5,787) $        73,677 
            
* 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.
**** Amount is offset by corresponding decrease in other deductions and has no earnings impact for the year ended September 30, 2023.


 
NATIONAL FUEL GAS COMPANY
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS PER SHARE
QUARTER ENDED SEPTEMBER 30, 2023
(Unaudited)
            
 Upstream Midstream Downstream     
            
 Exploration & Pipeline &     Corporate /  
 Production Storage Gathering Utility All Other Consolidated*
            
Fourth quarter 2022 GAAP earnings per share$        1.26  $        0.27  $        0.34  $        (0.12) $        (0.04) $        1.71 
Items impacting comparability:           
Unrealized gain (loss) on derivative asset, net of tax         0.03                   0.03 
Reversal of deferred tax valuation allowance         (0.31)            0.04               (0.27)
Remeasurement of deferred income taxes from Pennsylvania state income tax rate reduction         (0.18)            (0.13)            —           (0.31)
Unrealized (gain) loss on other investments, net of tax                 0.01           0.01 
Rounding         0.01                 0.01           0.02 
Fourth quarter 2022 adjusted operating results per share         0.81           0.27           0.25           (0.12)          (0.02)          1.19 
Drivers of adjusted operating results**           
Upstream Revenues           
Higher (lower) natural gas production         0.14                   0.14 
Higher (lower) realized natural gas prices, after hedging         (0.40)                  (0.40)
Higher (lower) other operating revenues         (0.01)                  (0.01)
Midstream Revenues           
Higher (lower) operating revenues           (0.03)          0.03               — 
Downstream Margins***           
Impact of usage and weather               —             — 
Impact of new rates in Pennsylvania               0.01             0.01 
Impact of new rates in New York****               (0.01)            (0.01)
System modernization and improvement tracker revenues               —             — 
Regulatory revenue adjustments               0.02             0.02 
Operating Expenses           
Lower (higher) lease operating and transportation expenses         (0.01)                  (0.01)
Lower (higher) operating expenses         (0.02)            —           (0.02)          (0.03)          (0.07)
Lower (higher) property, franchise and other taxes         0.01                   0.01 
Lower (higher) depreciation / depletion         (0.11)          (0.01)          —           (0.01)            (0.13)
Other Income (Expense)           
(Higher) lower other deductions           0.01             0.01           —           0.02 
(Higher) lower interest expense         (0.01)            0.01           (0.01)          0.01           — 
Income Taxes           
Lower (higher) income tax expense / effective tax rate         (0.02)          0.01           —           0.04           —           0.03 
All other / rounding         —           —           —           0.01           (0.02)          (0.01)
Fourth quarter 2023 adjusted operating results per share         0.38           0.25           0.29           (0.08)          (0.06)          0.78 
Items impacting comparability:           
Unrealized gain (loss) on derivative asset, net of tax         0.02                   0.02 
Unrealized gain (loss) on other investments, net of tax                 (0.01)          (0.01)
Rounding                 0.01           0.01 
Fourth quarter 2023 GAAP earnings per share$        0.40  $        0.25  $        0.29  $        (0.08) $        (0.06) $        0.80 
            
* 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.
**** Amount is offset by corresponding decrease in other deductions and has no earnings impact for the year ended September 30, 2023.


 
NATIONAL FUEL GAS COMPANY
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS
TWELVE MONTHS ENDED SEPTEMBER 30, 2023
(Unaudited)
            
 Upstream Midstream Downstream    
            
 Exploration & Pipeline &     Corporate /  
(Thousands of Dollars)Production Storage Gathering Utility All Other Consolidated*
            
Fiscal 2022 GAAP earnings$        306,064  $        102,557  $        101,111  $        68,948  $        (12,659) $        566,021 
Items impacting comparability:           
Reduction of other post-retirement regulatory liability               (18,533)            (18,533)
Tax impact of reduction of other post-retirement regulatory liability               3,892             3,892 
Unrealized gain (loss) on derivative asset         4,395                   4,395 
Tax impact of unrealized gain (loss) on derivative asset         (1,203)                  (1,203)
Gain on sale of West Coast assets         (12,736)                  (12,736)
Tax impact of gain on sale of West Coast assets         3,225                   3,225 
Loss from discontinuance of crude oil cash flow hedges         44,632                   44,632 
Tax impact of loss from discontinuance of crude oil cash flow hedges         (11,303)                  (11,303)
Transaction and severance costs related to West Coast asset sale         9,693                   9,693 
Tax impact of transaction and severance costs related to West Coast asset sale         (2,455)                  (2,455)
Reversal of deferred tax valuation allowance         (28,589)            3,739               (24,850)
Remeasurement of deferred income taxes from Pennsylvania state income tax rate reduction         (16,152)            (11,856)            (398)          (28,406)
Unrealized (gain) loss on other investments                 11,625           11,625 
Tax impact of unrealized (gain) loss on other investments                 (2,441)          (2,441)
Fiscal 2022 adjusted operating results         295,571           102,557           92,994           54,307           (3,873)          541,556 
Drivers of adjusted operating results**           
Upstream Revenues           
Higher (lower) natural gas production         62,913                   62,913 
Higher (lower) crude oil production         (88,063)                  (88,063)
Higher (lower) realized natural gas prices, after hedging         (48,413)                  (48,413)
Higher (lower) other operating revenues         (2,898)                  (2,898)
Midstream Revenues           
Higher (lower) operating revenues           1,696           12,224               13,920 
Downstream Margins***           
Impact of usage and weather               (1,104)            (1,104)
Impact of new rates in Pennsylvania               754             754 
Impact of new rates in New York****               (12,019)            (12,019)
System modernization and improvement tracker revenues               3,829             3,829 
Regulatory revenue adjustments               1,504             1,504 
Higher (lower) other operating revenues               1,734             1,734 
Operating Expenses           
Lower (higher) lease operating and transportation expenses         23,984                   23,984 
Lower (higher) operating expenses         11,145           (5,164)          (4,851)          (8,798)          (3,389)          (11,057)
Lower (higher) property, franchise and other taxes         6,041               597             6,638 
Lower (higher) depreciation / depletion         (26,065)          (2,470)          (1,364)          (1,335)            (31,234)
Other Income (Expense)           
(Higher) lower other deductions         2,735           3,624           561           14,030           (3,859)          17,091 
(Higher) lower interest expense         (724)          (796)          1,184           (8,575)          7,120           (1,791)
Income Taxes           
Lower (higher) income tax expense / effective tax rate         (3,406)          411           (1,006)          3,503           (380)          (878)
All other / rounding         114           643           (18)          (32)          (369)          338 
Fiscal 2023 adjusted operating results         232,934           100,501           99,724           48,395           (4,750)          476,804 
Items impacting comparability:           
Unrealized gain (loss) on derivative asset         (899)                  (899)
Tax impact of unrealized gain (loss) on derivative asset         240                   240 
Unrealized gain (loss) on other investments                 913           913 
Tax impact of unrealized gain (loss) on other investments                 (192)          (192)
Fiscal 2023 GAAP earnings$        232,275  $        100,501  $        99,724  $        48,395  $        (4,029) $        476,866 
            
* 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.
**** Amount is offset by corresponding decrease in other deductions and has no earnings impact for the year ended September 30, 2023.


 
NATIONAL FUEL GAS COMPANY
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS PER SHARE
TWELVE MONTHS ENDED SEPTEMBER 30, 2023
(Unaudited)
            
 Upstream Midstream Downstream    
            
 Exploration & Pipeline &     Corporate /  
 Production Storage Gathering Utility All Other Consolidated*
Fiscal 2022 GAAP earnings per share$        3.32  $        1.11  $        1.10  $        0.75  $        (0.13) $        6.15 
Items impacting comparability:           
Reduction of other post-retirement regulatory liability, net of tax               (0.16)            (0.16)
Unrealized gain (loss) on derivative asset, net of tax         0.03                   0.03 
Gain on sale of West Coast assets, net of tax         (0.10)                  (0.10)
Loss from discontinuance of crude oil cash flow hedges, net of tax         0.36                   0.36 
Transaction and severance costs related to West Coast asset sale, net of tax         0.08                   0.08 
Reversal of deferred tax valuation allowance         (0.31)            0.04               (0.27)
Remeasurement of deferred income taxes from Pennsylvania state income tax rate deduction         (0.18)            (0.13)            —           (0.31)
Unrealized (gain) loss on other investments, net of tax                 0.10           0.10 
Rounding         0.01                 (0.01)          — 
Fiscal 2022 adjusted operating results per share         3.21           1.11           1.01           0.59           (0.04)          5.88 
Drivers of adjusted operating results**           
Upstream Revenues           
Higher (lower) natural gas production         0.68                   0.68 
Higher (lower) crude oil production         (0.95)                  (0.95)
Higher (lower) realized natural gas prices, after hedging         (0.52)                  (0.52)
Higher (lower) other operating revenues         (0.03)                  (0.03)
Midstream Revenues           
Higher (lower) operating revenues           0.02           0.13               0.15 
Downstream Margins***           
Impact of usage and weather               (0.01)            (0.01)
Impact of new rates in Pennsylvania               0.01             0.01 
Impact of new rates in New York****               (0.13)            (0.13)
System modernization and improvement tracker revenues               0.04             0.04 
Regulatory revenue adjustments               0.02             0.02 
Higher (lower) other operating revenues               0.02             0.02 
Operating Expenses           
Lower (higher) lease operating and transportation expenses         0.26                   0.26 
Lower (higher) operating expenses         0.12           (0.06)          (0.05)          (0.10)          (0.04)          (0.13)
Lower (higher) property, franchise and other taxes         0.07       0.01             0.08 
Lower (higher) depreciation / depletion         (0.28)          (0.03)          (0.01)          (0.01)            (0.33)
Other Income (Expense)           
(Higher) lower other deductions         0.03           0.04           0.01           0.15           (0.04)          0.19 
(Higher) lower interest expense         (0.01)          (0.01)          0.01           (0.09)          0.08           (0.02)
Income Taxes           
Lower (higher) income tax expense / effective tax rate         (0.04)          —           (0.01)          0.04           —           (0.01)
All other / rounding         (0.02)          0.02           (0.01)          (0.02)          —           (0.03)
Fiscal 2023 adjusted operating results per share         2.52           1.09           1.08           0.52           (0.04)          5.17 
Items impacting comparability:           
Unrealized gain (loss) on derivative asset, net of tax         (0.01)                  (0.01)
Unrealized gain (loss) on other investments, net of tax                 0.01           0.01 
Rounding         0.01                 (0.01)          — 
Fiscal 2023 GAAP earnings per share$        2.52  $        1.09  $        1.08  $        0.52  $        (0.04) $        5.17 
            
* 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.
**** Amount is offset by corresponding decrease in other deductions and has no earnings impact for the year ended September 30, 2023.


        
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 2023   2022   2023   2022 
Operating Revenues:       
Utility Revenues$        78,865  $        112,252  $        941,779  $        897,916 
Exploration and Production and Other Revenues         220,348           252,035           958,455           1,010,629 
Pipeline and Storage and Gathering Revenues         69,735           70,859           273,537           277,501 
          368,948           435,146           2,173,771           2,186,046 
Operating Expenses:       
Purchased Gas         (12,865)          22,925           437,595           392,093 
Operation and Maintenance:       
Utility         48,354           46,535           205,239           193,058 
Exploration and Production and Other         37,955           31,554           124,270           191,572 
Pipeline and Storage and Gathering         39,901           39,138           149,247           136,571 
Property, Franchise and Other Taxes         20,701           23,089           92,700           101,182 
Depreciation, Depletion and Amortization         109,599           94,109           409,573           369,790 
          243,645           257,350           1,418,624           1,384,266 
Gain on Sale of Assets         —           —           —           12,736 
Operating Income         125,303           177,796           755,147           814,516 
        
Other Income (Expense):       
Other Income (Deductions)         5,384           (4,800)          18,138           (1,509)
Interest Expense on Long-Term Debt         (28,449)          (30,207)          (111,948)          (120,507)
Other Interest Expense         (4,453)          (3,289)          (19,938)          (9,850)
        
Income Before Income Taxes         97,785           139,500           641,399           682,650 
        
Income Tax Expense (Benefit)         24,108           (18,643)          164,533           116,629 
        
Net Income Available for Common Stock$        73,677  $        158,143  $        476,866  $        566,021 
        
Earnings Per Common Share       
Basic$        0.80  $        1.73  $        5.20  $        6.19 
Diluted$        0.80  $        1.71  $        5.17  $        6.15 
        
Weighted Average Common Shares:       
Used in Basic Calculation 91,818,933   91,476,535   91,748,890   91,410,625 
Used in Diluted Calculation 92,378,675   92,218,581   92,285,918   92,107,066 


 
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
  
 September 30, September 30,
(Thousands of Dollars) 2023   2022 
ASSETS   
Property, Plant and Equipment$        13,635,303  $        12,551,909 
Less - Accumulated Depreciation, Depletion and Amortization         6,335,441           5,985,432 
Net Property, Plant and Equipment         7,299,862           6,566,477 
Current Assets:   
Cash and Temporary Cash Investments         55,447           46,048 
Hedging Collateral Deposits         —           91,670 
Receivables - Net         160,601           361,626 
Unbilled Revenue         16,622           30,075 
Gas Stored Underground         32,509           32,364 
Materials and Supplies - at average cost         48,989           40,637 
Unrecovered Purchased Gas Costs         —           99,342 
Other Current Assets         100,260           59,369 
Total Current Assets         414,428           761,131 
Other Assets:   
Recoverable Future Taxes         69,045           106,247 
Unamortized Debt Expense         7,240           8,884 
Other Regulatory Assets         72,138           67,101 
Deferred Charges         82,416           77,472 
Other Investments         73,976           95,025 
Goodwill         5,476           5,476 
Prepaid Pension and Post-Retirement Benefit Costs         200,301           196,597 
Fair Value of Derivative Financial Instruments         50,487           9,175 
Other         4,891           2,677 
Total Other Assets         565,970           568,654 
Total Assets$        8,280,260  $        7,896,262 
CAPITALIZATION AND LIABILITIES   
Capitalization:   
Comprehensive Shareholders' Equity   
Common Stock, $1 Par Value Authorized - 200,000,000 Shares; Issued and   
Outstanding - 91,819,405 Shares and 91,478,064 Shares, Respectively$        91,819  $        91,478 
Paid in Capital         1,040,761           1,027,066 
Earnings Reinvested in the Business         1,885,856           1,587,085 
Accumulated Other Comprehensive Loss         (55,060)          (625,733)
Total Comprehensive Shareholders' Equity         2,963,376           2,079,896 
Long-Term Debt, Net of Current Portion and Unamortized Discount and Debt Issuance Costs         2,384,485           2,083,409 
Total Capitalization         5,347,861           4,163,305 
Current and Accrued Liabilities:   
Notes Payable to Banks and Commercial Paper         287,500           60,000 
Current Portion of Long-Term Debt         —           549,000 
Accounts Payable         152,193           178,945 
Amounts Payable to Customers         59,019           419 
Dividends Payable         45,451           43,452 
Interest Payable on Long-Term Debt         20,399           17,376 
Customer Advances         21,003           26,108 
Customer Security Deposits         28,764           24,283 
Other Accruals and Current Liabilities         160,974           257,327 
Fair Value of Derivative Financial Instruments         31,009           785,659 
Total Current and Accrued Liabilities         806,312           1,942,569 
Other Liabilities:   
Deferred Income Taxes         1,124,170           698,229 
Taxes Refundable to Customers         268,562           362,098 
Cost of Removal Regulatory Liability         277,694           259,947 
Other Regulatory Liabilities         165,441           188,803 
Other Post-Retirement Liabilities         2,915           3,065 
Asset Retirement Obligations         165,492           161,545 
Other Liabilities         121,813           116,701 
Total Other Liabilities         2,126,087           1,790,388 
Commitments and Contingencies         —           — 
Total Capitalization and Liabilities$        8,280,260  $        7,896,262 


    
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
 Twelve Months Ended
 September 30,
(Thousands of Dollars) 2023   2022 
    
Operating Activities:   
Net Income Available for Common Stock$        476,866  $        566,021 
Adjustments to Reconcile Net Income to Net Cash
Provided by Operating Activities:
   
Gain on Sale of Assets         —           (12,736)
Depreciation, Depletion and Amortization         409,573           369,790 
Deferred Income Taxes         151,403           104,415 
Stock-Based Compensation         20,630           19,506 
Reduction of Other Post-Retirement Regulatory Liability         —           (18,533)
Other         19,647           31,983 
Change in:   
Receivables and Unbilled Revenue         213,579           (168,769)
Gas Stored Underground and Materials, Supplies and Emission Allowances         (8,406)          3,109 
Unrecovered Purchased Gas Costs         99,342           (66,214)
Other Current Assets         (41,077)          291 
Accounts Payable         (37,095)          11,907 
Amounts Payable to Customers         58,600           398 
Customer Advances         (5,105)          8,885 
Customer Security Deposits         4,481           4,991 
Other Accruals and Current Liabilities         (67,664)          34,260 
Other Assets         (26,564)          (58,924)
Other Liabilities         (31,135)          (17,859)
Net Cash Provided by Operating Activities$        1,237,075  $        812,521 
    
Investing Activities:   
Capital Expenditures$        (1,009,868) $        (811,826)
Net Proceeds from Sale of Oil and Gas Producing Properties         —           254,439 
Acquisition of Upstream Assets         (124,758)          — 
Sale of Fixed Income Mutual Fund Shares in Grantor Trust         10,000           30,000 
Other         12,279           8,683 
Net Cash Used in Investing Activities$        (1,112,347) $        (518,704)
    
Financing Activities:   
Proceeds from Issuance of Short-Term Note Payable to Bank$        250,000  $        — 
Repayment of Short-Term Note Payable to Bank         (250,000)          — 
Net Change in Other Short-Term Notes Payable to Banks and Commercial Paper         227,500           (98,500)
Reduction of Long-Term Debt         (549,000)          — 
Net Proceeds From Issuance of Long-Term Debt         297,306           — 
Dividends Paid on Common Stock         (176,096)          (168,147)
Net Repurchases of Common Stock         (6,709)          (9,590)
Net Cash Used in Financing Activities$        (206,999) $        (276,237)
    
Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash         (82,271)          17,580 
Cash, Cash Equivalents, and Restricted Cash at Beginning of Period         137,718           120,138 
Cash, Cash Equivalents, and Restricted Cash at September 30$        55,447  $        137,718 


          
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 2023   2022  Variance  2023   2022  Variance
Total Operating Revenues$        220,348  $        252,035  $        (31,687) $        958,455  $        1,010,464  $        (52,009)
Operating Expenses:         
Operation and Maintenance:         
General and Administrative Expense         17,163           15,664           1,499           66,074           79,061           (12,987)
Lease Operating and Transportation Expense         64,412           62,701           1,711           253,555           283,914           (30,359)
All Other Operation and Maintenance Expense         2,357           1,957           400           9,327           20,140           (10,813)
Property, Franchise and Other Taxes         3,775           5,475           (1,700)          17,717           25,364           (7,647)
Depreciation, Depletion and Amortization         66,394           52,958           13,436           241,142           208,148           32,994 
          154,101           138,755           15,346           587,815           616,627           (28,812)
Gain on Sale of Assets         —           —           —           —           12,736           (12,736)
Operating Income         66,247   113,280           (47,033)          370,640   406,573           (35,933)
          
Other Income (Expense):         
Non-Service Pension and Post-Retirement Benefit (Costs) Credit         347           (186)          533           1,389           (744)          2,133 
Interest and Other Income (Deductions)         3,457           (3,080)          6,537           2,359           (2,466)          4,825 
Interest Expense         (15,268)          (14,474)          (794)          (54,317)          (53,401)          (916)
Income Before Income Taxes         54,783           95,540           (40,757)          320,071           349,962           (29,891)
Income Tax Expense (Benefit)         18,011           (20,537)          38,548           87,796           43,898           43,898 
Net Income$        36,772  $        116,077  $        (79,305) $        232,275  $        306,064  $        (73,789)
Net Income Per Share (Diluted)$        0.40  $        1.26  $        (0.86) $        2.52  $        3.32  $        (0.80)


          
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 2023   2022  Variance  2023   2022  Variance
Revenues from External Customers$        64,846  $        68,836  $        (3,990) $        259,646  $        265,415  $        (5,769)
Intersegment Revenues         29,192           28,913           279           119,545           111,629           7,916 
Total Operating Revenues         94,038           97,749           (3,711)          379,191           377,044           2,147 
Operating Expenses:         
Purchased Gas         326           592           (266)          1,436           1,890           (454)
Operation and Maintenance         29,154           28,868           286           106,654           100,117           6,537 
Property, Franchise and Other Taxes         8,322           8,470           (148)          33,774           34,133           (359)
Depreciation, Depletion and Amortization         17,953           17,283           670           70,827           67,701           3,126 
          55,755           55,213           542           212,691           203,841           8,850 
          
Operating Income         38,283           42,536           (4,253)          166,500           173,203           (6,703)
          
Other Income (Expense):         
Non-Service Pension and Post-Retirement Benefit Credit         1,330           767           563           5,319           3,069           2,250 
Interest and Other Income         2,017           1,490           527           6,670           3,820           2,850 
Interest Expense         (10,796)          (10,929)          133           (43,499)          (42,492)          (1,007)
Income Before Income Taxes         30,834           33,864           (3,030)          134,990           137,600           (2,610)
Income Tax Expense         7,480           8,544           (1,064)          34,489           35,043           (554)
Net Income$        23,354  $        25,320  $        (1,966) $        100,501  $        102,557  $        (2,056)
Net Income Per Share (Diluted)$        0.25  $        0.27  $        (0.02) $        1.09  $        1.11  $        (0.02)
          
          
 Three Months Ended Twelve Months Ended
 September 30, September 30,
GATHERING SEGMENT 2023   2022  Variance  2023   2022  Variance
Revenues from External Customers$        4,889  $        2,023  $        2,866  $        13,891  $        12,086  $        1,805 
Intersegment Revenues         53,129           52,061           1,068           216,426           202,757           13,669 
Total Operating Revenues         58,018           54,084           3,934           230,317           214,843           15,474 
Operating Expenses:         
Operation and Maintenance         11,123           10,725           398           44,375           38,234           6,141 
Property, Franchise and Other Taxes         21           24           (3)          60           37           23 
Depreciation, Depletion and Amortization         9,111           8,656           455           35,725           33,998           1,727 
          20,255           19,405           850           80,160           72,269           7,891 
          
Operating Income         37,763           34,679           3,084           150,157           142,574           7,583 
          
Other Income (Expense):         
Non-Service Pension and Post-Retirement Benefit (Costs) Credit         37           (56)          93           150           (224)          374 
Interest and Other Income         75           117           (42)          534           198           336 
Interest Expense         (3,433)          (4,105)          672           (14,989)          (16,488)          1,499 
Income Before Income Taxes         34,442           30,635           3,807           135,852           126,060           9,792 
Income Tax Expense (Benefit)         7,925           (589)          8,514           36,128           24,949           11,179 
Net Income$        26,517  $        31,224  $        (4,707) $        99,724  $        101,111  $        (1,387)
Net Income Per Share (Diluted)$        0.29  $        0.34  $        (0.05) $        1.08  $        1.10  $        (0.02)


          
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 2023   2022  Variance  2023   2022  Variance
Revenues from External Customers$        78,865  $        112,252  $        (33,387) $        941,779  $        897,916  $        43,863 
Intersegment Revenues         81           60           21           581           305           276 
Total Operating Revenues         78,946           112,312           (33,366)          942,360           898,221           44,139 
Operating Expenses:         
Purchased Gas         14,743           49,692           (34,949)          548,195           497,959           50,236 
Operation and Maintenance         49,056           47,369           1,687           208,539           196,254           12,285 
Property, Franchise and Other Taxes         8,454           8,981           (527)          40,624           41,137           (513)
Depreciation, Depletion and Amortization         16,026           15,167           859           61,450           59,760           1,690 
          88,279           121,209           (32,930)          858,808           795,110           63,698 
          
Operating Income (Loss)         (9,333)          (8,897)          (436)          83,552           103,111           (19,559)
          
Other Income (Expense):         
Non-Service Pension and Post-Retirement Benefit (Costs) Credit         9           (492)          501           4           5,526           (5,522)
Interest and Other Income         1,437           429           1,008           6,339           1,591           4,748 
Interest Expense         (8,041)          (7,000)          (1,041)          (34,233)          (24,115)          (10,118)
Income (Loss) Before Income Taxes         (15,928)          (15,960)          32           55,662           86,113           (30,451)
Income Tax Expense (Benefit)         (8,749)          (5,108)          (3,641)          7,267           17,165           (9,898)
Net Income (Loss)$        (7,179) $        (10,852) $        3,673  $        48,395  $        68,948  $        (20,553)
Net Income (Loss) Per Share (Diluted)$        (0.08) $        (0.12) $        0.04  $        0.52  $        0.75  $        (0.23)


 
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 2023   2022  Variance  2023   2022  Variance
Revenues from External Customers$        —  $        —  $        —  $        —  $        —  $        — 
Intersegment Revenues         —           —           —           —           6           (6)
Total Operating Revenues         —           —           —           —           6           (6)
Operating Expenses:         
Purchased Gas         —           —           —           —           6           (6)
Operation and Maintenance         —           —           —           21           5           16 
          —           —           —           21           11           10 
          
Operating Loss         —           —           —           (21)          (5)          (16)
Other Income (Expense):         
Interest and Other Income (Deductions)         (66)          1           (67)          (517)          3           (520)
Interest Expense         (68)          (4)          (64)          (157)          (4)          (153)
Loss before Income Taxes         (134)          (3)          (131)          (695)          (6)          (689)
Income Tax Expense (Benefit)         (33)          (1)          (32)          (164)          3           (167)
Net Loss$        (101) $        (2) $        (99) $        (531) $        (9) $        (522)
Net Loss Per Share (Diluted)$        —  $        —  $        —  $        —  $        —  $        — 
      
 Three Months Ended Twelve Months Ended
 September 30, September 30,
CORPORATE 2023   2022  Variance  2023   2022  Variance
Revenues from External Customers$        —  $        —  $        —  $        —  $        165  $        (165)
Intersegment Revenues         932           1,183           (251)          4,388           4,430           (42)
Total Operating Revenues         932           1,183           (251)          4,388           4,595           (207)
Operating Expenses:         
Operation and Maintenance         8,345           4,801           3,544           19,115           14,841           4,274 
Property, Franchise and Other Taxes         129           139           (10)          525           511           14 
Depreciation, Depletion and Amortization         115           45           70           429           183           246 
          8,589           4,985           3,604           20,069           15,535           4,534 
          
Operating Loss         (7,657)          (3,802)          (3,855)          (15,681)      ��   (10,940)          (4,741)
Other Income (Expense):         
Non-Service Pension and Post-Retirement Benefit Costs         (354)          (1,017)          663           (1,417)          (4,069)          2,652 
Interest and Other Income         36,337           33,712           2,625           147,935           126,648           21,287 
Interest Expense on Long-Term Debt         (28,449)          (30,207)          1,758           (111,948)          (120,507)          8,559 
Other Interest Expense         (6,089)          (3,262)          (2,827)          (23,370)          (8,211)          (15,159)
Loss before Income Taxes         (6,212)          (4,576)          (1,636)          (4,481)          (17,079)          12,598 
Income Tax Benefit         (526)          (952)          426           (983)          (4,429)          3,446 
Net Loss$        (5,686) $        (3,624) $        (2,062) $        (3,498) $        (12,650) $        9,152 
Net Loss Per Share (Diluted)$        (0.06) $        (0.04) $        (0.02) $        (0.04) $        (0.13) $        0.09 
          
          
 Three Months Ended Twelve Months Ended
 September 30, September 30,
INTERSEGMENT ELIMINATIONS 2023   2022  Variance  2023   2022  Variance
Intersegment Revenues$        (83,334) $        (82,217) $        (1,117) $        (340,940) $        (319,127) $        (21,813)
Operating Expenses:         
Purchased Gas         (27,934)          (27,359)          (575)          (112,036)          (107,762)          (4,274)
Operation and Maintenance         (55,400)          (54,858)          (542)          (228,904)          (211,365)          (17,539)
          (83,334)          (82,217)          (1,117)          (340,940)          (319,127)          (21,813)
Operating Income         —           —           —           —           —           — 
Other Income (Expense):         
Interest and Other Deductions         (39,242)          (36,485)          (2,757)          (150,627)          (134,861)          (15,766)
Interest Expense         39,242           36,485           2,757           150,627           134,861           15,766 
Net Income$        —  $        —  $        —  $        —  $        —  $        — 
Net Income Per Share (Diluted)$        —  $        —  $        —  $        —  $        —  $        — 


            
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
  2023   2022  (Decrease)  2023   2022  (Decrease)
            
Capital Expenditures:           
Exploration and Production(1)$        144,938 (2)$        160,056 (3)$        (15,118) $        737,725 (2)(3)$        565,791 (3)(4)$        171,934 
Pipeline and Storage         75,109 (2)         37,563 (3)         37,546           141,877 (2)(3)         95,806 (3)(4)         46,071 
Gathering         47,917 (2)         26,957 (3)         20,960           103,295 (2)(3)         55,546 (3)(4)         47,749 
Utility         51,246 (2)         40,061 (3)         11,185           139,922 (2)(3)        111,033 (3)(4)         28,889 
Total Reportable Segments         319,210           264,637           54,573           1,122,819           828,176           294,643 
All Other         —           —           —           —           —           — 
Corporate         305           549           (244)          754           1,212           (458)
Total Capital Expenditures$        319,515