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National Fuel Reports Third Quarter Fiscal 2025 Earnings and Announces Preliminary Guidance for Fiscal 2026

WILLIAMSVILLE, N.Y., July 30, 2025 (GLOBE NEWSWIRE) -- National Fuel Gas Company (鈥淣ational Fuel鈥� or the 鈥淐ompany鈥�) (NYSE:NFG) today announced consolidated results for the third quarter of its 2025 fiscal year.

FISCAL 2025 THIRD QUARTER SUMMARY

• GAAP earnings per share of $1.64 compared to a net loss $0.59 per share in the prior year.
• Adjusted earnings per share of $1.64 increased 66% compared to $0.99 per share in the prior year. See non-GAAP reconciliation on page 2.
• Exploration and Production adjusted operating results of $0.95 per share increased 157% versus the prior year, driven by lower per unit operating costs, higher realized natural gas prices, and strong well performance in the Eastern Development Area (鈥淓DA鈥�), which contributed to 112 Bcf of natural gas production, up 16% versus the prior year鈥檚 third quarter.
• The Pipeline and Storage segment achieved several development milestones for expansion projects during the quarter with the announcement of the Shippingport Lateral Project and the receipt of FERC approval for the Tioga Pathway Project, which remains on track for a late calendar 2026 in-service date.
• The Company generated $196 million in net cash provided by operating activities less net cash used in investing activities during the third quarter.
• The Company is revising the midpoint of its fiscal 2025 adjusted earnings per share guidance to a range of $6.80 to $6.95 per share and is initiating its fiscal 2026 preliminary earnings guidance which, based upon a NYMEX price of $4.00, is expected to increase 20% from fiscal 2025 (see Guidance Summary on page 7).
  

MANAGEMENT COMMENTARY

David P. Bauer, President and Chief Executive Officer of National Fuel Gas Company, stated: 鈥淣ational Fuel鈥檚 excellent third quarter reflects ongoing success across the Company. Our integrated upstream and gathering operations saw record production and throughput during the quarter and a continued improvement in capital efficiency, while our regulated Utility and Pipeline & Storage segments continue to see an uplift in earnings from recent ratemaking activities and organic investment opportunities.

鈥淎s we look forward to fiscal 2026, we expect to see significant earnings growth versus the prior year. This highlights the momentum in each of our businesses and the overall positive long-term outlook for natural gas. Strong well results in the EDA continue to confirm the depth of our best-in-class inventory and operational excellence in Northeast Pennsylvania, and underpin our mid-single-digit production growth expectations in the coming years. In addition, we have line of sight to further growth in our regulated businesses, supporting our 5% to 7% average annual rate base growth projections. Taken together, along with the broader tailwinds from growing demand for natural gas, National Fuel is well positioned to create meaningful value for shareholders in the years to come.鈥�

RETURN OF CAPITAL UPDATE

During the quarter, National Fuel announced that its Board of Directors approved a 4% increase in the Company鈥檚 dividend for an annual rate of $2.14 per share. This is our 55^th consecutive year of dividend increases and the 123^rd year of consecutive dividend payments, demonstrating the Company's commitment to returning cash to shareholders.

With respect to the Company鈥檚 share repurchase program, since March 2024, the Company repurchased approximately 2 million shares at an average weighted price of $59.70 per share. Consistent with our disciplined approach to capital allocation, which balances growth with return of capital to shareholders, during the quarter the Company paused repurchases as it evaluated various growth opportunities, preserving balance sheet flexibility.

RECONCILIATION OF GAAP EARNINGS TO ADJUSTED OPERATING RESULTS

FISCAL 2025 GUIDANCE UPDATE

National Fuel is revising its adjusted earnings per share guidance for fiscal 2025 to a range of $6.80 to $6.95. This updated range incorporates our third quarter results as well as lower expected realized natural gas prices for the remaining three months, which is largely offset by expected higher production and lower unit costs in the Exploration and Production segment. The Company is assuming an average NYMEX natural gas price of $3.25 per MMBtu for the remaining three months of fiscal 2025, which approximates the current NYMEX forward curve at this time.

The Company鈥檚 other fiscal 2025 guidance assumptions are detailed in the table on page 7.

INITIATION OF FISCAL 2026 PRELIMINARY GUIDANCE

The Company is initiating preliminary earnings guidance for fiscal 2026 which it is providing at various NYMEX prices:

2026 OUTLOOK

• Seneca鈥檚 ongoing trend of improving capital efficiency is projected to continue in fiscal 2026 with capital expenditures expected to decrease by $20 million, or 4% at the midpoint, while production is expected to increase to a range of 440 to 455 Bcf, an increase of 6% at the midpoint.
• Regulated segment earnings are expected to increase as a result of ongoing modernization investments which are supported by recent ratemaking efforts, driven by Distribution鈥檚 three-year New York rate settlement that continues through fiscal 2027 and additional margin related to the Pennsylvania modernization tracker, or DSIC (Distribution System Improvement Charge).
• Combined Utility and Pipeline & Storage segment capital expenditures are expected to range between $395 and $455 million, an increase of $110 million from fiscal 2025 at midpoint of guidance, with continued investment in our longstanding modernization programs, as well as significant expansion-related spending on the Tioga Pathway and Shippingport Lateral projects driving meaningful rate base growth.
  
  

Additional details on the Company鈥檚 updated forecast assumptions and business segment guidance for fiscal 2026 are outlined in the table on page 7.

DISCUSSION OF THIRD QUARTER RESULTS BY SEGMENT

The following earnings discussion of each operating segment for the quarter ended June 30, 2025 is summarized in a tabular form on pages 8 and 9 of this report (earnings drivers for the nine months ended June听30, 2025 are summarized on pages 10 and 11). It may be helpful to refer to those tables while reviewing this discussion.

Note that management defines adjusted operating results as reported GAAP earnings adjusted for items impacting comparability, and adjusted EBITDA as reported GAAP earnings before the following items: interest expense, income taxes, depreciation, depletion and amortization, other income and deductions, impairments, and other items reflected in operating income that impact comparability.

Upstream Business

Exploration and Production Segment

The Exploration and Production segment operations are carried out by Seneca Resources Company, LLC (鈥淪eneca鈥�). Seneca explores for, develops and produces primarily natural gas reserves in Pennsylvania.

Seneca鈥檚 third quarter GAAP earnings increased $198.7 million versus the prior year. GAAP earnings in the prior year included a non-cash, pre-tax ceiling test impairment of $200.7 million ($145.0 million after-tax) to write-down the carrying value of Seneca鈥檚 reserves under the full cost method of accounting. GAAP earnings also included the impact of unrealized losses related to reductions in the fair value of contingent consideration received in connection with the June 2022 divestiture of Seneca鈥檚 California assets.

Excluding items impacting comparability, Seneca鈥檚 adjusted operating results in the third quarter increased $52.9 million primarily due to higher realized natural gas prices and production, as well as lower per unit operating expenses.

During the third quarter, Seneca produced a Company record 112 Bcf of natural gas, an increase of 15 Bcf, or 16%, from the prior year. Two highly prolific Utica pads turned in line this year in the EDA鈥檚 Tioga County were the main drivers behind this increase in production.

Seneca鈥檚 weighted average realized natural gas price, after the impact of hedging and transportation costs, was $2.71 per Mcf, an increase of $0.43 per Mcf from the prior year. This increase was primarily due to higher NYMEX prices and higher spot prices at local sales points in Pennsylvania.

On a per unit basis, third quarter total cash operating costs were lower compared to the prior year, primarily due to higher production. LOE included $61 million ($0.55 per Mcf), or 83% of total LOE, for gathering and compression service fees paid to the Company鈥檚 Gathering segment to connect Seneca鈥檚 production to sales points along interstate pipelines. DD&A for the quarter was $0.62 per Mcf, a decrease of $0.09 per Mcf from the prior year, largely due to ceiling test impairments recorded in prior quarters that lowered Seneca鈥檚 full cost pool depletable base.

Midstream Businesses

Pipeline and Storage Segment

The Pipeline and Storage segment鈥檚 operations are carried out by National Fuel Gas Supply Corporation (鈥淪upply Corporation鈥�) and Empire Pipeline, Inc. (鈥淓mpire鈥�). The Pipeline and Storage segment provides natural gas transportation and storage services to affiliated and non-affiliated companies through an integrated system of pipelines and underground natural gas storage fields in western New York and Pennsylvania.

The Pipeline and Storage segment鈥檚 third quarter GAAP earnings decreased $1.8 million versus the prior year primarily due to higher Operations and Maintenance ("O&M") expense. The increase in O&M expense was due largely to typical inflationary increases related to higher personnel costs and third-party contractors.

Gathering Segment

The Gathering segment鈥檚 operations are carried out by National Fuel Gas Midstream Company, LLC鈥檚 limited liability companies. The Gathering segment constructs, owns and operates natural gas gathering pipelines and compression facilities in the Appalachian region, which delivers Seneca and other non-affiliated Appalachian production to the interstate pipeline system.

The Gathering segment鈥檚 third quarter GAAP earnings increased $5.0 million versus the prior year primarily due to higher operating revenues, which increased $7.8 million, or 13%, primarily due to an increase in throughput from Seneca鈥檚 new wells located in Tioga County.

Downstream Business

Utility Segment

The Utility segment operations are carried out by National Fuel Gas Distribution Corporation (鈥淒istribution Corporation鈥�), which sells or transports natural gas to customers located in western New York and northwestern Pennsylvania.

The Utility segment鈥檚 third quarter GAAP earnings increased $2.4 million, or 95%, primarily as a result of new rates approved in the Utility鈥檚 New York rate case settlement, which became effective October 1, 2024, partially offset by higher operating costs and interest expense.

For the quarter, customer margin (operating revenues less purchased gas sold) increased $8.4 million, primarily due to an increase in customer usage, due in part to colder weather, as well as an increase in rates as part of the New York rate case settlement. Other income increased $4.0 million, largely due to the New York rate settlement, which required the recognition of non-service pension and post-retirement benefit income and a corresponding reduction in new base rates, resulting in no effect on net income.

O&M expense increased $2.7 million primarily driven by higher personnel costs, partially offset by a reduction in uncollectible expenses as a result of a tracker implemented as part of the New York rate case settlement. DD&A expense increased by $1.6 million primarily due to higher average depreciable plant in service compared to the prior year. Further, interest expense increased $2.5 million primarily due to a higher average amount of net borrowings.

Corporate and All Other

The Company鈥檚 operations that are included in Corporate and All Other generated a combined net loss of $0.7 million, which was largely consistent with the prior year.

EARNINGS TELECONFERENCE

A conference call to discuss the results will be held on Thursday, July 31, 2025, at 9 a.m. ET. All participants must pre-register to join this conference using the . A webcast link to the conference call will be provided under the Events Calendar on the NFG Investor Relations website at . A replay will be available following the call through the end of the day, Thursday, August 7, 2025. To access the replay, dial 1-866-813-9403 and provide Access Code 592578.

National Fuel is an integrated energy company reporting financial results for four operating segments: Exploration and Production, Pipeline and Storage, Gathering, and Utility. Additional information about National Fuel is available at .

Certain statements contained herein, including statements identified by the use of the words 鈥渁nticipates,鈥� 鈥渆stimates,鈥� 鈥渆xpects,鈥� 鈥渇orecasts,鈥� 鈥渋ntends,鈥� 鈥減lans,鈥� 鈥減redicts,鈥� 鈥減rojects,鈥� 鈥渂elieves,鈥� 鈥渟eeks,鈥� 鈥渨ill,鈥� 鈥渕ay鈥� and similar expressions, and statements which are other than statements of historical facts, are 鈥渇orward-looking statements鈥� as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties, which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. The Company鈥檚 expectations, beliefs and projections contained herein are expressed in good faith and are believed to have a reasonable basis, but there can be no assurance that such expectations, beliefs or projections will result or be achieved or accomplished. In addition to other factors, the following are important factors that could cause actual results to differ materially from those discussed in the forward-looking statements: changes in laws, regulations or judicial interpretations to which the Company is subject, including those involving derivatives, taxes, safety, employment, climate change, other environmental matters, real property, and exploration and production activities such as hydraulic fracturing; governmental/regulatory actions, initiatives and proceedings, including those involving rate cases (which address, among other things, target rates of return, rate design, retained natural gas and system modernization), environmental/safety requirements, affiliate relationships, industry structure, and franchise renewal; changes in economic conditions, including the imposition of additional tariffs on U.S. imports and related retaliatory tariffs, inflationary pressures, supply chain issues, liquidity challenges, and global, national or regional recessions, and their effect on the demand for, and customers鈥� ability to pay for, the Company鈥檚 products and services; the Company鈥檚 ability to estimate accurately the time and resources necessary to meet emissions targets; governmental/regulatory actions and/or market pressures to reduce or eliminate reliance on natural gas; impairments under the SEC鈥檚 full cost ceiling test for natural gas reserves; changes in the price of natural gas; the creditworthiness or performance of the Company鈥檚 key suppliers, customers and counterparties; financial and economic conditions, including the availability of credit, and occurrences affecting the Company鈥檚 ability to obtain financing on acceptable terms for working capital, capital expenditures and other investments, including any downgrades in the Company鈥檚 credit ratings and changes in interest rates and other capital market conditions; the Company鈥檚 ability to complete strategic transactions; changes in price differentials between similar quantities of natural gas sold at different geographic locations, and the effect of such changes on commodity production, revenues and demand for pipeline transportation capacity to or from such locations; the impact of information technology disruptions, cybersecurity or data security breaches, including the impact of issues that may arise from the use of artificial intelligence technologies; factors affecting the Company鈥檚 ability to successfully identify, drill for and produce economically viable natural gas reserves, including among others geology, lease availability and costs, title disputes, weather conditions, water availability and disposal or recycling opportunities of used water, shortages, delays or unavailability of equipment and services required in drilling operations, insufficient gathering, processing and transportation capacity, the need to obtain governmental approvals and permits, and compliance with environmental laws and regulations; increased costs or delays or changes in plans with respect to Company projects or related projects of other companies, as well as difficulties or delays in obtaining necessary governmental approvals, permits or orders or in obtaining the cooperation of interconnecting facility operators; increasing health care costs and the resulting effect on health insurance premiums and on the obligation to provide other post-retirement benefits; other changes in price differentials between similar quantities of natural gas having different quality, heating value, hydrocarbon mix or delivery date; the cost and effects of legal and administrative claims against the Company or activist shareholder campaigns to effect changes at the Company; negotiations with the collective bargaining units representing the Company鈥檚 workforce, including potential work stoppages during negotiations; uncertainty of natural gas reserve estimates; significant differences between the Company鈥檚 projected and actual production levels for natural gas; changes in demographic patterns and weather conditions (including those related to climate change); changes in the availability, price or accounting treatment of derivative financial instruments; changes in laws, actuarial assumptions, the interest rate environment and the return on plan/trust assets related to the Company鈥檚 pension and other post-retirement benefits, which can affect future funding obligations and costs and plan liabilities; economic disruptions or uninsured losses resulting from major accidents, fires, severe weather, natural disasters, terrorist activities or acts of war, as well as economic and operational disruptions due to third-party outages; significant differences between the Company鈥檚 projected and actual capital expenditures and operating expenses; or increasing costs of insurance, changes in coverage and the ability to obtain insurance. The Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date thereof.

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

GUIDANCE SUMMARY

As discussed on page 2, the Company is revising its adjusted earnings per share guidance for fiscal 2025. Additional details on the Company's forecast assumptions and business segment guidance are outlined in the table below.

The revised adjusted earnings per share guidance range excludes certain items that impacted the comparability of adjusted operating results during the nine months ended June 30, 2025, including: (1) the after tax impairment of assets, which reduced earnings by $1.14 per share; (2) after-tax premiums paid on early redemptions of debt, which reduced earnings by $0.02 per share; (3) after-tax unrealized losses on a derivative asset, which reduced earnings by $0.01 per share; and (4) after-tax unrealized losses on other investments, which reduced earnings by $0.02 per share. While the Company expects to record certain adjustments to unrealized gain or loss on investments during the remaining three months ending September 30, 2025, the amounts of these and other potential adjustments are not reasonably determinable at this time. As such, the Company is unable to provide earnings guidance other than on a non-GAAP basis.