EXHIBIT 99.01
(NJR LOGO) (NEWS RELEASE)
1415 Wyckoff Road P.O. Box 1464 Wall, NJ 07719
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DATE: APRIL 28, 2004 CONTACTS: KEVIN CONNELLY (MEDIA)
732-938-1031
OR
DENNIS PUMA (INVESTORS)
732-938-1229
NEW JERSEY RESOURCES REPORTS IMPROVED FINANCIAL
PERFORMANCE; PROVIDES EARNINGS GUIDANCE FOR FISCAL 2004
- - NJR'S FISCAL 2004 YEAR-TO-DATE EARNINGS INCREASE TO $2.75 PER BASIC SHARE,
COMPARED WITH $2.39 PER BASIC SHARE LAST YEAR, A 15 PERCENT INCREASE
- - NJR REPORTS SECOND-QUARTER 2004 BASIC AND DILUTED EARNINGS PER SHARE OF
$1.86 AND $1.82, RESPECTIVELY
- - NJR PROVIDES EARNINGS GUIDANCE OF BETWEEN $2.55 AND $2.65 PER BASIC SHARE
FOR FISCAL 2004
- - NJR ON TRACK TO PRODUCE ITS 13TH CONSECUTIVE YEAR OF EARNINGS GROWTH
- - CONFERENCE CALL AT 3 P.M. EDT TO DISCUSS SECOND-QUARTER AND YEAR-TO-DATE
EARNINGS, AND OUTLOOK FOR BALANCE OF FISCAL 2004
WALL, N.J. - New Jersey Resources (NYSE: NJR) today reported a 15 percent
increase in basic earnings per share for the six months ended March 31, 2004, to
$2.75, compared with $2.39 last year. On a diluted basis, earnings per share for
the six months ended March 31, 2004, increased to $2.70, compared with $2.35
last year. Fiscal second-quarter basic earnings per share increased 22 percent
to $1.86, compared with $1.52 last year. On a diluted basis, earnings per share
for the three months ended March 31, 2004, increased to $1.82, compared with
$1.50 last year. The financial community consensus estimate for the three months
was $1.50 per diluted share. The increase in earnings for both periods is
attributable primarily to higher margins at NJR Energy Services (NJRES), NJR's
unregulated wholesale energy services subsidiary, and continued customer growth
at New Jersey Natural Gas (NJNG), NJR's principal subsidiary.
Based on the year-to-date results, and assuming normal weather, the impact of
seasonal factors and the timing of certain expenses, the company estimates that
it will achieve basic earnings per share for fiscal 2004 in the range of $2.55
to $2.65.
"Our consistent financial performance confirms our strategy of focusing on
meeting the energy needs of customers in our core energy business in New Jersey
and achieving profitable growth in related energy markets," said Laurence M.
Downes, chairman and CEO of NJR. "Based on our earnings guidance, we are
expecting to achieve our 13th consecutive year of earnings growth this year - a
streak that we believe is the longest in the industry," Mr. Downes said.
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NEW JERSEY RESOURCES REPORTS IMPROVED FINANCIAL PERFORMANCE;
PROVIDES EARNINGS GUIDANCE FOR FISCAL 2004
PAGE 2 OF 9
FINANCIAL AND OPERATING HIGHLIGHTS INCLUDED:
- - HIGHER NET INCOME AND BASIC EARNINGS PER SHARE - For the six months ended
March 31, 2004, NJR earned $75.4 million, or $2.75 per share, compared
with $64.6 million, or $2.39 per share, last year. NJNG earned $54.4
million for the 6-month period ended March 31, 2004, compared with $53.7
million last year, driven by higher gross margin from continued profitable
customer growth. NJRES reported an 84 percent increase in earnings to
$20.6 million, compared with $11.2 million last year, due primarily to
higher gross margin from its portfolio of storage and transportation
capacity assets as well as higher management fees. NJR earned $51 million,
or $1.86 per basic share, for the three months ended March 31, 2004,
compared with $41.2 million, or $1.52 per share, for the same period last
year, reflecting primarily improved results for both NJRES and NJNG.
- - STRONG CUSTOMER GROWTH - During the first six months of the fiscal year,
NJNG added approximately 1 billion cubic feet (Bcf) of throughput to new
and existing customers, which is expected to generate about $2.9 million
in gross margin. NJNG expects to maintain its approximately 2.5 percent
annual customer growth rate in fiscal 2004, well above the national
average for natural gas distribution companies. About 35 percent of new
customers are expected to convert from other fuels. In fiscal 2004, NJNG
expects to add approximately 2 Bcf of firm sales representing about $6
million of annual gross margin.
Gross margin is defined as natural gas revenues less natural gas costs,
sales tax, a Transitional Energy Facilities Assessment (TEFA), which is
included in Energy and other taxes on the Consolidated Statements of
Income, and regulatory rider expenses. Management believes that gross
margin provides a more meaningful basis for evaluating utility operations
than revenue since natural gas costs, sales tax, TEFA and regulatory rider
expenses are passed through to customers, and therefore have no effect on
gross margin. Natural gas costs are charged to operating expenses on the
basis of therm sales at the prices approved by the New Jersey Board of
Public Utilities through NJNG's Basic Gas Supply Service (BGSS) tariff.
The BGSS allows NJNG to recover natural gas costs that exceed the level
reflected in the company's base rates. Sales tax is calculated at 6
percent of revenue and excludes sales to cogeneration facilities, other
utilities, off-system sales and federal accounts. TEFA is calculated on a
per-therm basis and excludes sales to cogeneration facilities, other
utilities and off-system sales. Regulatory rider expenses are calculated
on a per-therm basis.
- - WEATHER - For the six months ended March 31, 2004, weather was 4 percent
colder than normal and 6 percent warmer than last year. Weather for the
second quarter was 8 percent colder than normal and 4 percent warmer than
last year. "Normal" weather is based on 20-year average temperatures. The
impact of the weather is significantly offset by NJNG's
weather-normalization clause (WNC), which is designed to smooth out
year-to-year fluctuations that may result from changing weather patterns
on both NJNG's gross margin and customers' bills. NJNG deferred $2.4
million of gross margin for the six months ended March 31, 2004, through
its WNC for future credits to customers due to colder-than-normal weather.
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NEW JERSEY RESOURCES REPORTS IMPROVED FINANCIAL PERFORMANCE;
PROVIDES EARNINGS GUIDANCE FOR FISCAL 2004
PAGE 3 OF 9
- - OFF-SYSTEM SALES AND CAPACITY MANAGEMENT PROGRAMS - During the first six
months of the fiscal year, NJNG's off-system sales, capacity management
and financial risk management (FRM) programs totaled 26.7 Bcf and $3.7
million of gross margin, compared with 26.4 Bcf and $2.9 million of gross
margin for the same period last year. NJNG shares the gross margin earned
from off-system sales and capacity management programs with customers and
shareowners according to a margin-sharing formula in effect through
October 2006. This fiscal year, customers have saved approximately $19
million in natural gas costs through these programs. Since the
establishment of these incentive programs in 1992, NJNG customers have
saved nearly $225 million on their natural gas bills. For the three months
ended March 31, 2004, these programs totaled 13.2 Bcf and generated $2.2
million of gross margin, compared with 12.4 Bcf and $1.7 million of gross
margin during the respective period last year.
- - WHOLESALE ENERGY SERVICES - NJRES' earnings of $20.6 million during the
first six months of the fiscal year benefited from higher gross margin
generated from an increased storage and transportation portfolio. Results
also included higher management fees associated with NJRES' management of
other companies' storage, transportation and fuel contracts. NJRES has
developed a portfolio of storage and transportation capacity assets in the
Gulf Coast, Mid-Continent, Appalachia and Eastern Canada, which become
more valuable when there are changing prices between these areas. These
assets are also more valuable when prices change between time periods.
Gross margin from this portfolio is generally greater during the winter
months, while the fixed costs of these assets are spread throughout the
year. Therefore, the results for the six months will not be indicative of
the results for the fiscal year. Revenues for both periods declined on a
year-to-year basis due primarily to the expiration of a large-volume,
low-margin capacity contract in March 2003. For the three months ended
March 31, 2004, NJRES earned $15.3 million, compared with $7.3 million
last year.
- - NJR HOME SERVICES AND OTHER - This business segment consists of NJR Home
Services, which provides service, sales and installation of appliances to
over 137,000 customers; Commercial Realty & Resources, which develops
commercial real estate; and NJR Energy, which consists primarily of a 3.2
percent equity investment in Iroquois Gas Transmission System, L.P.
(Iroquois). Earnings for the six months ended March 31, 2004, were
$433,000, compared with a loss of $271,000 last year. Earnings for the
three months were $393,000, compared with a loss of $200,000 last year.
The increase in both periods was due primarily to better results from
Iroquois.
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NEW JERSEY RESOURCES REPORTS IMPROVED FINANCIAL PERFORMANCE;
PROVIDES EARNINGS GUIDANCE FOR FISCAL 2004
PAGE 4 OF 9
- - OPERATION AND MAINTENANCE EXPENSES - Consolidated operation and
maintenance (O&M) expenses were $51.9 million for the six months ended
March 31, 2004, compared with $49.7 million last year. For the quarter,
O&M expenses were $26.9 million versus $25.4 million last year. The
increase in both periods was due primarily to higher pension, other
post-retirement benefits and insurance expenses.
- - THIRD YEAR ON FORTUNE 1000 - For the third year in a row, NJR earned a
spot on the Fortune 1000. NJR ranked 591, advancing 123 places over the
prior year on the list released in the April issue of Fortune magazine.
The Fortune 1000 ranks the largest publicly traded U.S. corporations by
annual revenues. Among the 54 natural gas and electric utilities listed,
NJR ranked second in annual return to investors and fourth for annual
earnings-per-share growth for the 10 years ended 2003.
WEBCAST INFORMATION
NJR will host a live webcast to discuss the quarter's financial results today at
3 p.m. EDT. To listen to the call, logon to NJR's Web site, NJLIVING.COM, and
select "Investor Relations," then click just below the microphone on the right
side of the Investor Relations home page.
ABOUT NEW JERSEY RESOURCES
New Jersey Resources (NYSE:NJR), a Fortune 1000 company and a member of the
Forbes Platinum 400, provides retail and wholesale energy services to customers
in New Jersey and in states from the Gulf Coast to New England, and Canada. Its
principal subsidiary, New Jersey Natural Gas, is one of the fastest-growing
local distribution companies in the United States, serving nearly 450,0000
customers in central and northern New Jersey. Other major NJR subsidiaries
include NJR Energy Services (NJRES) and NJR Home Services (NJRHS). NJRES is a
leader in the unregulated energy services market, providing outstanding customer
service and management of natural gas storage and capacity assets. NJRHS offers
retail customers expert heating, air conditioning and appliance services. NJR's
progress is a tribute to the more than 5,000 dedicated current and former
employees who have shared their expertise and focus on quality through more than
50 years of serving customers and the community to make NJR a leader in the
competitive energy marketplace. More information on NJR can be found on our Web
site at NJLIVING.COM.
FORWARD-LOOKING STATEMENTS
This news release contains estimates and other forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. NJR
cautions readers that the assumptions forming the basis for forward-looking
statements include many factors that are beyond NJR's ability to control or
estimate precisely, such as estimates of future market conditions and the
behavior of other market participants. Other factors that could cause actual
results to differ materially from our expectations include, but are not limited
to, weather conditions, economic conditions in NJNG's
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NEW JERSEY RESOURCES REPORTS IMPROVED FINANCIAL PERFORMANCE;
PROVIDES EARNINGS GUIDANCE FOR FISCAL 2004
PAGE 5 OF 9
service territory, impact of regulation (including the regulation of rates),
fluctuations in energy-related commodity prices, conversion activity, other
marketing efforts, environmental matters, litigation and other uncertainties.
More detailed information about these factors is set forth in NJR's filings with
the Securities and Exchange Commission, including NJR's quarterly report on Form
10-Q filed on February 9, 2004. NJR's Form 10-Q is available at www.sec.gov. NJR
does not, by including this statement, assume any obligation to review or revise
any particular forward-looking statement referenced herein in light of future
events.
NEW JERSEY RESOURCES
CONSOLIDATED FINANCIAL RESULTS
(Unaudited) Three Months Ended Six Months Ended
Thousands, except per share data March 31, March 31,
2004 2003 2004 2003
---------- ---------- ---------- ----------
Operating Revenues $1,037,661 $1,152,337 $1,680,707 $1,820,874
Net Income $ 51,027 $ 41,244 $ 75,405 $ 64,567
Earnings Per Common Share
Basic $ 1.86 $ 1.52 $ 2.75 $ 2.39
Diluted $ 1.82 $ 1.50 $ 2.70 $ 2.35
Average Shares Outstanding
Basic 27,484 27,048 27,410 27,016
Diluted 28,030 27,467 27,947 27,428
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Page 6 of 9
NEW JERSEY RESOURCES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(Thousands, except per share data)
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Three Months Ended Six Months Ended
March 31, March 31,
2004 2003 2004 2003
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OPERATING REVENUES $1,037,661 $1,152,337 $1,680,707 $1,820,874
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OPERATING EXPENSES
Gas purchases 888,047 1,025,005 1,438,993 1,605,150
Operation and maintenance 26,871 25,403 51,893 49,716
Regulatory rider expenses 4,340 1,944 6,970 3,264
Depreciation and amortization 8,306 8,002 16,536 16,083
Energy and other taxes 23,079 20,839 37,050 33,863
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TOTAL OPERATING EXPENSES 950,643 1,081,193 1,551,442 1,708,076
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OPERATING INCOME 87,018 71,144 129,265 112,798
Other income 551 193 1,931 1,133
Interest charges, net 3,691 3,456 7,344 7,785
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INCOME BEFORE INCOME TAXES 83,878 67,881 123,852 106,146
Income tax provision 32,851 26,637 48,447 41,579
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NET INCOME $51,027 $41,244 $75,405 $64,567
==========================================================================================================
EARNINGS PER COMMON SHARE
BASIC $1.86 $1.52 $2.75 $2.39
DILUTED $1.82 $1.50 $2.70 $2.35
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DIVIDENDS PER COMMON SHARE $0.325 $0.31 $0.65 $0.62
==========================================================================================================
AVERAGE SHARES OUTSTANDING
BASIC 27,484 27,048 27,410 27,016
DILUTED 28,030 27,467 27,947 27,428
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Page 7 of 9
NEW JERSEY RESOURCES
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Three Months Ended Six Months Ended
(Unaudited) March 31, March 31,
(Thousands, except per share data) 2004 2003 2004 2003
================================================================================================
OPERATING REVENUES
New Jersey Natural Gas $399,607 $334,795 $651,841 $560,879
NJR Energy Services 633,095 815,404 1,018,593 1,254,216
NJR Home Services and Other 4,983 4,668 10,320 9,425
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SUBTOTAL 1,037,685 1,154,867 1,680,754 1,824,520
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Intercompany Eliminations (24) (2,530) (47) (3,646)
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TOTAL $1,037,661 $1,152,337 $1,680,707 $1,820,874
====================================================
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OPERATING INCOME
New Jersey Natural Gas $59,582 $58,434 $92,672 $93,232
NJR Energy Services 27,148 12,461 36,341 19,381
NJR Home Services and Other 288 249 252 185
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TOTAL $87,018 $71,144 $129,265 $112,798
====================================================
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NET INCOME
New Jersey Natural Gas $35,318 $34,161 $54,383 $53,684
NJR Energy Services 15,316 7,283 20,589 11,154
NJR Home Services and Other 393 (200) 433 (271)
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TOTAL $51,027 $41,244 $75,405 $64,567
====================================================
================================================================================================
THROUGHPUT (BCF)
NJNG, Core Customers 32.8 33.5 52.8 55.3
NJNG, Off System/Capacity Management 13.2 12.4 26.7 26.4
NJRES Fuel Mgmt. and Wholesale Sales 95.6 114.2 170.2 216.0
----------------------------------------------------
TOTAL 141.6 160.1 249.7 297.7
====================================================
================================================================================================
COMMON STOCK DATA
Yield at March 31 3.4% 3.8% 3.4% 3.8%
Market Price
High $40.00 $33.70 $40.00 $33.70
Low $36.80 $30.01 $35.76 $29.52
Close at March 31 $37.80 $32.65 $37.80 $32.65
Shares Out. at March 31 27,509 27,073 27,509 27,073
Market Cap. at March 31 $1,039,840 $883,933 $1,039,840 $883,933
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Page 8 of 9
NEW JERSEY NATURAL GAS
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Three Months Ended Six Months Ended
(Unaudited) March 31, March 31,
(Thousands, except customer & weather data) 2004 2003 2004 2003
=================================================================================================
OPERATING REVENUES
Residential $241,769 $202,889 $383,502 $326,356
Commercial, Industrial and Other 56,969 42,604 90,860 73,955
Firm Transportation 10,663 13,173 19,029 22,559
----------------------------------------------------
TOTAL FIRM REVENUES 309,401 258,666 493,391 422,870
Interruptible 993 874 2,719 2,435
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TOTAL SYSTEM REVENUES 310,394 259,540 496,110 425,305
----------------------------------------------------
Off System 89,213 75,255 155,731 135,574
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TOTAL REVENUES $399,607 $334,795 $651,841 $560,879
====================================================
=================================================================================================
GROSS MARGIN AND OPERATING INCOME
Residential $63,164 $62,125 $105,871 $106,619
Commercial, Industrial and Other 14,346 11,766 23,856 20,180
Firm Transportation 8,939 11,335 16,099 19,147
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TOTAL FIRM MARGIN 86,449 85,226 145,826 145,946
Interruptible 223 40 501 182
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TOTAL SYSTEM MARGIN 86,672 85,266 146,327 146,128
----------------------------------------------------
Off System/Capacity Management/FRM 2,158 1,706 3,704 2,924
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TOTAL GROSS MARGIN 88,830 86,972 150,031 149,052
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Operation and maintenance expense 20,480 20,089 39,817 38,819
Depreciation and amortization 8,139 7,799 16,202 15,681
Other taxes not reflected in
gross margin 629 650 1,340 1,320
----------------------------------------------------
OPERATING INCOME $59,582 $58,434 $92,672 $93,232
====================================================
=================================================================================================
THROUGHPUT (BCF)
Residential 22.8 22.3 35.9 36.1
Commercial, Industrial and Other 5.0 5.1 8.0 8.4
Firm Transportation 3.8 4.8 6.4 7.8
----------------------------------------------------
TOTAL FIRM THROUGHPUT 31.6 32.2 50.3 52.3
Interruptible 1.2 1.3 2.5 3.0
----------------------------------------------------
TOTAL SYSTEM THROUGHPUT 32.8 33.5 52.8 55.3
----------------------------------------------------
Off System/Capacity Management 13.2 12.4 26.7 26.4
----------------------------------------------------
TOTAL THROUGHPUT 46.0 45.9 79.5 81.7
====================================================
=================================================================================================
CUSTOMERS
Residential 405,710 387,288 405,710 387,288
Commercial, Industrial and Other 27,823 25,788 27,823 25,788
Firm Transportation 16,137 26,498 16,137 26,498
----------------------------------------------------
TOTAL FIRM CUSTOMERS 449,670 439,574 449,670 439,574
Interruptible 51 58 51 58
----------------------------------------------------
TOTAL SYSTEM CUSTOMERS 449,721 439,632 449,721 439,632
----------------------------------------------------
Off System/Capacity Management 36 34 36 34
----------------------------------------------------
TOTAL CUSTOMERS 449,757 439,666 449,757 439,666
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Page 9 of 9
NEW JERSEY NATURAL GAS
================================================================================================
Three Months Ended Six Months Ended
(Unaudited) March 31, March 31,
(Thousands, except customer & weather data) 2004 2003 2004 2003
================================================================================================
DEGREE DAYS
Actual 2,716 2,822 4,340 4,629
Normal 2,516 2,488 4,179 4,136
----------------------------------------------------
Percent of Normal 107.9% 113.4% 103.9% 111.9%
----------------------------------------------------
NJR ENERGY SERVICES
================================================================================================
OPERATING REVENUES $633,095 $815,404 $1,018,593 $1,254,216
GAS PURCHASES 603,669 801,463 979,078 1,232,066
----------------------------------------------------
GROSS MARGIN $29,426 $13,941 $39,515 $22,150
====================================================
OPERATING INCOME $27,148 $12,461 $36,341 $19,381
====================================================
NET INCOME $15,316 $7,283 $20,589 $11,154
====================================================
GAS SOLD AND MANAGED (BCF) 95.6 114.2 170.2 216.0
====================================================
NJR HOME SERVICES AND OTHER
================================================================================================
OPERATING REVENUES $4,983 $4,668 $10,320 $9,425
====================================================
OPERATING INCOME $288 $249 $252 $185
====================================================
NET INCOME $393 ($200) $433 ($271)
====================================================
TOTAL CUSTOMERS AT MARCH 31 137,445 132,755 137,445 132,755
====================================================
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