NW Natural Holdings reported second quarter net earnings of $2.1 million or 7 cents per share from continuing operations, compared to a loss of $339,000 or 1 cent per share in 2018.
The 8 cents per share increase includes a $4.2 million, 14 cents/share increase in the natural gas utility segment, partially offset by a $1.8 million, 6 cents/share decline from lower asset management revenues at the company’s Mist field natural gas storage operation and higher nonoperating expenses associated with developing its water business.
David Anderson, president and CEO, said during an Aug. 6 earnings call that the company had “executed very well” on its growth initiatives and posted “strong” financial results.
The company placed its North Mist gas storage facility into service in May—used by Portland General Electric to provide no-notice gas supply for wind-firming peakers—and closed its largest water and wastewater transaction to-date on May 31.
Also in May, NW Natural reached an all-party settlement on key items in its Washington general rate case (CU No. 1903 [9.1]).
In the natural gas utility segment, margins increased $8.3 million, largely due to higher Oregon rates and strong customer growth of 1.7 percent, or 12,400 natural gas meters, over the last 12 months, the company said, which added $4.6 million. Lower environmental expenses and warmer weather contributed $2.2 million in revenue, helping offset a $2.1-million increase in other expenses.
Storage revenue from the North Mist expansion contributed an additional $1.6 million.
Also impacting earnings was a regulatory pension disallowance from the final order issued in March in the Oregon general rate case that amounted to a one-time charge of $6.6 million after-tax and 23 cents on a per-share basis (CU No. 1890 ; 1895 [7.8]).
Year-to-date earnings were $1.56 per share from continuing operations, and adjusted earnings were $1.79 per share for 2019, compared to earnings of $1.45 per share from continuing operations for 2018.
Excluding the pension-related disallowance, net income increased $0.34 per share or $10.4 million, to $52.1 million or $1.79 per share for the first six months of 2019. The results reflect new rates in Oregon and customer growth.
NW Natural reaffirmed earnings guidance for the year from continuing operations in the range of $2.02 to $2.22 per share. Excluding the regulatory pension disallowance, the guidance is in the range of $2.25 to $2.45 per share.