National Fuel Gas Q3 Earnings Call Highlights

Q3 adjusted EPS fell to $1.54 , down $0.10 year over year, as lower production offset improved natural-gas pricing and hedge gains. National Fuel revised fiscal 2026 EPS guidance to $7.40–$7.60 and expects 7%–10% annual EPS growth through fiscal 2029. National Fuel remains on track to close its Ohio utility acquisition in the fourth quarter, supported by $1.5 billion of debt financing and new share issuance. Near-term free cash flow will prioritize debt reduction, with management targeting leverage of roughly 2–2.25 times within several years. The company is expanding pipeline capacity and refining its development strategy around the Lower Utica, including record-length laterals expected to begin production in early 2027. It also plans to invest $100 million–$200 million over several years to expand its Tioga County acreage.

National Fuel Gas NYSE: NFG reported third-quarter fiscal 2026 adjusted earnings of $1.54 per share, down $0.10 from a year earlier, as lower production in its integrated upstream and gathering operations more than offset stronger natural-gas price realizations and hedge gains. President and Chief Executive Officer Dave Bauer said the quarter was generally in line with company expectations. The company also updated its long-term outlook, projecting average annual earnings-per-share growth of 7% to 10% through fiscal 2029, assuming the current natural-gas forward curve. National Fuel expects to generate $1 billion to $1.5 billion of free cash flow over that period.

“Each of our businesses is positioned to deliver meaningful growth in earnings and free cash flow,” Bauer said, citing regulated-business expansion opportunities, the pending Ohio utility acquisition and its Tioga County upstream acreage position.

Treasurer and Chief Financial Officer Tim Silverstein said National Fuel revised its fiscal 2026 adjusted EPS guidance to a range of $7.40 to $7.60 per share. The change primarily reflects an updated production forecast for Seneca Resources of 420 billion to 430 billion cubic feet equivalent, or BCFE, for the year. The company maintained its NYMEX natural-gas price assumption of $3 per MMBtu. National Fuel said it is hedged on 75% of its remaining fiscal-year production at prices above the current market strip. Silverstein said regulated operations continued to benefit from margin growth under New York’s multiyear rate plan and revenue from Pennsylvania’s Distribution Integrity and Safety, or DISC, mechanism. Those gains were largely offset by higher operating costs, including inflation, the absence of a prior-year New York bad-debt tracker benefit and the effects of a new Pennsylvania field-operations labor agreement. For fiscal 2027, the company expects additional expansion revenue of nearly $30 million from the Tioga Pathway Project and Shippingport Lateral Project. It also anticipates earnings growth from its regulated businesses as rate proceedings conclude, the New York rate plan continues and the Ohio acquisition closes.

National Fuel said it remains on track to close its acquisition of CenterPoint’s Ohio gas utilities during the calendar fourth quarter, targeting an Oct. 1 closing date. The Ohio Commission approved the transaction in June, and the company said its June debt issuance completed its financing needs for the acquisition. The company raised $1.5 billion in a three-tranche debt offering with three-, five- and 10-year maturities and a weighted average interest rate of slightly more than 5%. National Fuel used part of the proceeds to redeem a $300 million note due i...