New Jersey Resources Corporation

What they do

NJR operates through four reportable segments: New Jersey Natural Gas (NJNG), its regulated retail gas utility; Clean Energy Ventures (CEV), which develops, builds and operates commercial solar projects and sells RECs and electricity; Storage and Transportation (S&T), which holds natural gas storage and transportation assets including Adelphia and Leaf River; and Energy Services (ES), which provides wholesale natural gas and related energy services. A fifth grouping, Home Services and Other (HSO), covers appliance repair, sales and installations at NJRHS and commercial real estate at CR&R. NJNG is by far the largest segment, holding $5.20 billion of the $7.58 billion in total assets at fiscal year-end 2025.

Revenue drivers

• New Jersey Natural Gas (NJNG) — Regulated retail natural gas distribution, earning net income of $213.5 million in fiscal 2025 on $5.20 billion of segment assets; earnings rose $80.1 million year over year primarily on base rates effective November 21, 2024.
• Clean Energy Ventures (CEV) — Commercial solar development and operation plus REC and electricity sales; earned $61.2 million in fiscal 2025, up $27.5 million, helped by the gain on sale of the residential solar portfolio, with roughly 479 MW of commercial solar capacity in service.
• Energy Services (ES) — Wholesale natural gas and related energy services; earned $40.9 million in fiscal 2025, down $65.9 million from $106.7 million in fiscal 2024 due to timing of revenue recognition related to the AMAs and higher natural gas purchase prices.
• Storage and Transportation (S&T) — Natural gas storage and transportation assets, including Adelphia and Leaf River; earned $18.5 million in fiscal 2025 on $1.03 billion of segment assets.

Recent performance

For fiscal 2026 third quarter ended June 30, 2026, NJR reported consolidated net income of $9.7 million, or $0.10 per share, compared with a net loss of $(15.1) million, or $(0.15) per share, a year earlier. Year-to-date net income through June 30, 2026 was $351.1 million, or $3.48 per share, versus $320.6 million, or $3.20 per share, for the prior-year period. The year-to-date increase was driven by a $38.1 million increase at ES from market volatility and favorable pricing spreads related to colder weather, a $16.9 million increase at NJNG from higher base rates and customer growth, and a $9.9 million increase at S&T on higher firm transportation and storage rates. These were partly offset by a $33.3 million decrease at CEV related to the prior-year gain on sale of the residential solar portfolio. Quarterly net financial earnings, a non-GAAP measure, were $11.3 million, or $0.11 per share, versus $6.2 million, or $0.06 per share, a year earlier.

Strategy

Management is investing in regulated utility plant at NJNG, which added $246.8 million in net utility plant expenditures in the nine months ended June 30, 2026 versus September 30, 2025, and in commercial solar at CEV, which added $144.2 million in net nonutility plant and equipment over the same period. CEV placed eleven commercial solar projects totaling 93.6 MW into service during fiscal 2025 at a cost of approximately $249.1 million. The company continues to assess the impact of the July 2025 OBBBA and subsequent IRS guidance on the beginning-of-construction rules for investment tax credits. NJR maintains a stated long-term NFEPS growth target of 7 to 9 percent from a fiscal 2025 base of $2.83 per share.

Risks

• Clean energy tax credit changes — The OBBBA phases out certain clean energy tax credits, requiring solar facilities to be placed in service by December 31, 2027 unless construction begins before July 4, 2026, which could affect CEV's ability to develop future projects.
• Energy Services earnings volatility — ES results swing sharply with weather, pricing spreads and the timing of revenue recognition related to the AMAs, as shown by its $65.9 million earnings decline in fiscal 2025 and $38.1 million increase in the fiscal 2026 year-to-date period.
• Cybersecurity and technology failure — The company states that cyberattacks, ransomware or malicious acts at interconnected third parties could disrupt operations, require added costs, or result in loss of confidential customer data and litigation.
• Commercial solar project execution — CEV's capital expenditures are subject to construction timing, permitting, grid interconnection, supply chain sourcing, U.S. trade policy and tariffs on clean energy equipment, any of which could delay or prevent projects from commencing operations.

Outlook

Management tightened fiscal 2026 net financial earnings per share guidance to a range of $3.52 to $3.62, from the prior range of $3.48 to $3.63. Expected fiscal 2026 NFE contributions by segment are 59 to 62 percent from NJNG, 21 to 23 percent from ES, 10 to 13 percent from CEV, 8 to 11 percent from S&T, and 0 to 1 percent from HSO. The company reiterates a long-term NFEPS growth target of 7 to 9 percent and states that guidance is subject to risks including the positions of its energy-related derivatives, for which it cannot reasonably estimate the GAAP impact.