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New Jersey Resources Corp (NJR) Q2 Fiscal 2024 Earnings Analysis: Aligns with EPS Projections, ...

GuruFocus Research
·4-min read

  • Net Income: Reported $120.8 million for Q2 fiscal 2024, up from $110.2 million in Q2 fiscal 2023, slightly exceeding the estimate of $120.5 million.

  • Earnings Per Share (EPS): Achieved $1.23 in Q2 fiscal 2024, compared to $1.14 in the same quarter last year, falling short of the estimated $1.33.

  • Revenue: Total operating revenues reached $657.9 million in Q2 fiscal 2024, up from $644.0 million in Q2 fiscal 2023, falling short of the estimated $670.0 million.

  • Net Financial Earnings (NFE): Grew to $138.6 million in Q2 fiscal 2024 from $112.3 million in Q2 fiscal 2023.

  • Guidance: Fiscal 2024 NFEPS guidance reaffirmed at $2.85 to $3.00, reflecting confidence in ongoing business performance.

  • Energy Services Performance: Reported significant growth in NFE to $37.6 million in Q2 fiscal 2024 due to effective capitalization on natural gas price volatility.

  • Capital Expenditures: Continued investments in infrastructure and energy efficiency programs to support long-term growth and customer service enhancements.

On May 7, 2024, New Jersey Resources Corp (NYSE:NJR) unveiled its financial results for the second quarter of fiscal 2024, providing a detailed look at the company's earnings and operational performance. The results were disclosed in their recent 8-K filing.

Company Overview

New Jersey Resources is an energy services holding company primarily engaged through its subsidiaries in providing natural gas services. NJR's regulated utility, New Jersey Natural Gas, serves over 575,000 customers in New Jersey. The company's non-regulated ventures include investments in solar projects and midstream natural gas projects, reflecting a diversified business model.

Financial Performance Summary

For the second quarter of fiscal 2024, NJR reported net income of $120.8 million, or $1.23 per share, which aligns closely with analyst estimates of $1.33 per share. Compared to the prior year's quarter, this represents an increase from $110.2 million, or $1.14 per share. However, the company's revenue for the quarter stood at $657.9 million, falling short of the estimated $670 million.

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Year-to-date figures also show a nuanced picture. The net income for the first half of fiscal 2024 reached $210.2 million, or $2.14 per share, a slight decrease from $226.2 million, or $2.34 per share, in the corresponding period of the previous year. This dip reflects some of the challenges faced by the company, including market volatility and operational costs.

Segment Performance and Strategic Initiatives

NJR's primary segment, New Jersey Natural Gas, reported a net financial earnings (NFE) of $107.1 million for the quarter, up from $100.7 million in the same quarter last year. This growth is attributed to higher contributions from BGSS incentive programs, though offset by increased depreciation and operating expenses.

The Clean Energy Ventures segment, however, experienced a net financial loss of $5.6 million, an improvement over last year's loss of $9.4 million, thanks largely to tax credits and increased revenue from solar renewable energy certificates.

Energy Services showed a robust performance with NFE of $37.6 million, significantly up from $21.1 million in the prior year, benefiting from natural gas price volatility. This underscores the strategic advantage of NJR's diversified operations, which can capitalize on market fluctuations to bolster financial performance.

Outlook and Future Projections

Looking ahead, NJR has reaffirmed its fiscal 2024 NFEPS guidance range of $2.85 to $3.00, reflecting confidence in its operational strategy and market position. The company anticipates that Energy Services will contribute a larger percentage to the NFEPS, highlighting the strategic importance of this segment.

Management's commentary from Steve Westhoven, President and CEO, emphasized the strength of NJR's diversified business model and its focus on delivering shareholder value through strategic growth initiatives and operational efficiency.

Investor Implications

While NJR's alignment with EPS projections and slight revenue miss present a mixed financial picture, the company's strategic positioning and segment performance suggest a stable outlook. Investors and stakeholders might find reassurance in NJRs ability to navigate market volatility and drive growth through its diversified business operations.

For detailed financial figures and further information, stakeholders are encouraged to review the full earnings report and managements discussion in the 8-K filing linked above.

For more updates and expert analyses, stay tuned to GuruFocus.com.

Explore the complete 8-K earnings release (here) from New Jersey Resources Corp for further details.

This article first appeared on GuruFocus.