$NWN earnings report

NW Natural Holdings reported a seasonally loss-making third quarter with GAAP net loss of ($29,840), compared with ($29,890) a year earlier. Diluted loss per share improved to ($0.71) from ($0.73). Operating revenues were $177,972 versus $164,728, but total operating expenses rose to 186,683 from 177,151. The principal reported cost pressures were depreciation of 44,956 versus 40,510 and net interest expense of 34,481 versus 30,435.

The first nine months showed stronger earnings momentum. GAAP net income was $68,249, compared with $55,526, and diluted EPS was $1.62, compared with $1.36. On an adjusted basis, nine-month net income was $68,249 and adjusted EPS was $1.62, versus adjusted net income of $62,203 and adjusted EPS of $1.52 in 2025. The improvement included $4.4 million of higher SiEnergy net income and an $8.5 million reduction in Other net loss, while NW Natural Water net income declined $1.7 million.

Regulatory outcomes are central to the earnings outlook. Washington rates became effective Aug. 1, 2026 and included a $20.1 million first-year annual revenue increase. Oregon's approved ARM provides a $13.0 million increase to annual revenue requirement, with rates effective Oct. 31, 2026. SiEnergy reached a settlement providing an $8.6 million revenue requirement increase, subject to approval. The company also reported 17,000 added gas and water utility connections over the 12 months ended Sept. 30, 2026.

Capital deployment remained substantial. The company invested (373,449) in capital expenditures during the first nine months, while cash provided by operating activities was 213,125. Financing included 315,000 of long-term debt issued, against (105,415) of long-term debt retired. At September 30, long-term debt was 2,540,817, compared with 2,128,101 a year earlier, and cash and cash equivalents were $30,329.

Management raised 2026 EPS guidance to $3.10 – $3.20 from $2.95 – $3.15, with the prior outlook described as expecting the upper half of that range. Capital-expenditure guidance remained $500 – $550 million. The company reaffirmed 2026 – 2030 targets of 4.0% – 6.0% EPS growth, 6.0% – 8.0% rate-base growth, $2.6 – $2.9 billion of capital expenditures, and 2.0% – 3.0% customer growth. The declared $0.50 quarterly dividend raises the indicated annual dividend rate to $2.00 per share.

Northwest Natural Holdings reported second-quarter net income of $600 and GAAP EPS of $0.01, compared with a net loss of ($2,500) and a loss per share of ($0.06) in the same period in 2025. Adjusted net income was $600 and adjusted EPS was $0.01, versus $315 and $0.01, respectively. For the first six months, GAAP net income reached $98,089 and EPS was $2.33, compared with $85,416 and $2.11 in 2025. First-half adjusted net income was $98,089 and adjusted EPS was $2.33, versus $92,118 and $2.28.

Segment performance was uneven. NW Natural's second-quarter net income declined to $3,933 from $4,924 as increased O&M expense, depreciation expense and financing costs outweighed higher margin from Oregon rates. NWN Water net income declined to $2,272 from $2,833 as increased O&M expenses more than offset revenue benefits from rate increases and customer growth. SiEnergy was the principal operating growth contributor, with net income increasing to $2,056 from $1,014, supported by customer growth, the Texas House Bill 4384 cost deferrals and a full quarter of Pines earnings contribution.

The Other segment's net loss improved to ($7,661) from ($11,271), primarily because acquisition and business development expenses were lower than in the prior-year quarter. On an adjusted basis, Other's net loss was ($7,661), compared with ($8,456), with the company citing higher net income from NW Natural Renewables. The company also added nearly 18,000 gas and water utility connections over the 12 months ended June 30, 2026, representing a growth rate of 1.9%, and invested $235 million in gas and water systems during the first six months.

Regulatory outcomes improve visibility into future revenue requirements. The Washington order approved a $20.1 million first-year increase beginning Aug. 1, 2026, followed by $7.5 million and $7.4 million increases in the subsequent two years. In Oregon, the filed ARM settlement provides for a $13.0 million annual revenue-requirement increase, compared with the original $15.6 million request, pending an expected Commission order later this year.

Management expects 2026 EPS in the upper half of its $2.95 – $3.15 guidance range and retained capital-expenditure guidance of $500 – $550 million. The company also reaffirmed 2026 – 2030 targets for EPS growth of 4.0% – 6.0%, EPS growth including MX3 of 5.0% – 7.0%, capital expenditures of $2.6 – $2.9 billion, rate-base growth of 6.0% – 8.0%, and customer growth of 2.0% – 3.0%. Key execution issues are sustaining customer growth and regulatory recovery while managing the O&M, depreciation and financing-cost pressures identified in the reported period.