CHESAPEAKE UTILITIES CORP 10-Q

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations Management’s Discussion and Analysis of Financial Condition and Results of Operations is designed to provide a reader of the financial statements with a narrative report on our financial condition, results of operations and liquidity. This discussion and analysis should be read in conjunction with the attached unaudited condensed consolidated financial statements and notes thereto and our Annual Report on Form 10-K for the year ended December 31, 2024, including the audited consolidated financial statements and notes thereto. Safe Harbor for Forward-Looking Statements We make statements in this Quarterly Report on Form 10-Q (this "Quarterly Report") that do not directly or exclusively relate to historical facts. Such statements are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. One can typically identify forward-looking statements by the use of forward-looking words, such as “project,” “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” “continue,” “potential,” “forecast” or other similar words, or future or conditional verbs such as “may,” “will,” “should,” “would” or “could.” These statements represent our intentions, plans, expectations, assumptions and beliefs about future financial performance, business strategy, projected plans and objectives of the Company. Forward-looking statements speak only as of the date they are made or as of the date indicated and we do not undertake any obligation to update forward-looking statements as a result of new information, future events or otherwise. These statements are subject to many risks and uncertainties. In addition to the risk factors described under Item 1A., Risk Factors in our 2024 Annual Report on Form 10-K, the following important factors, among others, could cause actual future results to differ materially from those expressed in the forward-looking statements: • state and federal legislative and regulatory initiatives that affect cost and investment recovery, have an impact on rate structures, and affect the speed and the degree to which competition enters the electric and natural gas industries; • the outcomes of regulatory, environmental and legal matters, including whether pending matters are resolved within current estimates and whether the related costs are adequately covered by insurance or recoverable in rates; • the impact of climate change, including the impact of greenhouse gas emissions or other legislation or regulations intended to address climate change; • the impact of significant changes to current tax regulations and rates, including the impact they may have on our financial positions, results of operations and/or cash flows; • the timing of certification authorizations associated with new capital projects and the ability to construct facilities at or below estimated costs, and within estimated timeframes; • changes in environmental and other laws and regulations to which we are subject and environmental conditions of property that we now, or may in the future, own or operate; • changes in the current political environment, including the effects the Presidential administration could have on energy policy, the economy and consumer confidence; • possible increased federal, state and local regulation of the safety of our operations; • the availability and reliability of adequate technology, including our ability to adapt to technological advances, effectively implement new technologies and manage the related costs; • the inherent hazards and risks involved in transporting and distributing natural gas, electricity and propane; • the economy in our service territories or markets, the nation, and worldwide, including the impact of economic conditions (which we do not control) such as the risk and uncertainties associated with tariffs and trade wars, on demand for natural gas, electricity, propane or other fuels; • risks related to cyber-attacks or cyber-terrorism that could disrupt our business operations or result in failure of information technology systems or result in the loss or exposure of confidential or sensitive customer, employee or Company information; • issues relating to the implementation and effective use of technologies to support our business, including artificial intelligence; • adverse weather conditions, including the effects of hurricanes, ice storms and other damaging weather events; • customers' preferred energy sources and our expectations regarding customer consumption; • industrial, commercial and residential growth or contraction in our markets or service territories; • the effect of competition on our businesses from other energy suppliers and alternative forms of energy; • the timing and extent of changes in commodity prices and interest rates; • the effect of spot, forward and future market prices on our various energy businesses; • the extent of our success in connecting natural gas and electric supplies to our transmission systems, establishing and maintaining key supply sources, and expanding natural gas and electric markets; • the creditworthiness of counterparties with which we are engaged in transactions; • the capital-intensive nature of our regulated energy businesses; 31 Table of Contents • our ability to access the credit and capital markets to execute our business strategy, including our ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general economic conditions; • the ability to successfully execute, manage and integrate a merger, acquisition or divestiture of assets or businesses and the related regulatory or other conditions associated with the merger, acquisition or divestiture; • the impact on our costs and funding obligations, under our pension and other postretirement benefit plans, of potential downturns in the financial markets, lower discount rates, and costs associated with health care legislation and regulation; • the ability to continue to hire, train and retain appropriately qualified personnel; • the availability of, and competition for, qualified personnel supporting our natural gas, electricity and propane businesses; • the effect of accounting pronouncements issued periodically by accounting standard-setting bodies; and • the impacts associated with a pandemic, including the duration and scope of the pandemic the corresponding impact on our supply chains, our personnel, our contract counterparties, general economic conditions and growth, the financial markets and any costs to comply with governmental mandates. Introduction Chesapeake Utilities Corporation is a Delaware corporation formed in 1947 with operations primarily in the Mid-Atlantic region, North Carolina, South Carolina, Florida and Ohio. We are an energy delivery company engaged in the distribution of natural gas, electricity and propane, the transmission of natural gas, the generation of electricity and steam, and in providing mobile compressed natural gas and other energy-related services to our customers. Our strategy is focused on growing earnings from a stable regulated energy delivery foundation and investing in related businesses and services that together provide opportunities for returns greater than traditional utility returns. We seek to identify and develop opportunities across the energy value chain, with emphasis on regulated midstream and downstream investments that are accretive to earnings per share and create opportunities to continue our record of top tier returns on equity relative to our peer group. The Company’s growth strategy includes the continued investment and expansion of the Company’s regulated operations that provide a stable base of earnings, as well as investments in other related non-regulated businesses and services including sustainable investments, such as renewable natural gas-related investments. Currently, our growth strategy is focused on the following platforms, including: • Prudently deploying investment capital. ◦ Optimizing the earnings growth in our existing businesses, which includes organic growth, territory expansions, and new products and services. ◦ Identification and pursuit of additional pipeline expansions, including new interstate and intrastate transmission projects. ◦ Growth of Marlin Gas Services’ CNG transport business and expansion into LNG and RNG transport services as well as methane capture. ◦ Identifying and undertaking additional strategic propane acquisitions that provide a larger foundation in current markets and expand our brand and presence into new strategic growth markets. ◦ Leveraging our current capabilities, including our integrated set of energy delivery businesses, to support and contribute to a more sustainable future. • Proactively managing our regulatory agenda. ◦ Driving regulatory initiatives that align with our growth strategy and investment plans. • Continually executing on our business transformation initiatives. ◦ Increased opportunities to transform the Company with a focus on people, process, technology and organizational structure. Due to the seasonality of our business, results for interim periods are not necessarily indicative of results for the entire fiscal year. Revenue and earnings are typically greater during the first and fourth quarters, when consumption of energy is normally highest due to colder temperatures. Sustainability Across the Company Our focus on sustainability is supported and shared across the organization by the dedication and efforts of our BOD and its Committees, as well as the entrepreneurship and dedication of our team. As stewards of long-term enterprise value, our BOD is committed to overseeing the sustainability of the Company, its environmental stewardship initiatives, its safety and operational compliance practices. 32 Table of Contents These commitments guide our mission to deliver energy that makes life better for the people and communities we serve. They impact every aspect of the relationships we have with our stakeholders. Beginning in 2024, we unveiled our first in a continuing series of sustainability micro-reports. We encourage our investors to review the micro-reports, as well as prior sustainability reports, which can be accessed on our website, and welcome feedback as we continue to enhance our sustainability disclosures. Non-GAAP Financial Measures This document, including the tables herein, include references to both Generally Accepted Accounting Principles ("GAAP") and non-GAAP financial measures, including Adjusted Gross Margin, Adjusted Net Income and Adjusted EPS. A "non-GAAP financial measure" is generally defined as a numerical measure of a company's historical or future performance that includes or excludes amounts, or that is subject to adjustments, so as to be different from the most directly comparable measure calculated or presented in accordance with GAAP. Our management believes certain non-GAAP financial measures, when considered together with GAAP financial measures, provide information that is useful to investors in understanding period-over-period operating results separate and apart from items that may, or could, have a disproportionately positive or negative impact on results in any particular period. We calculate Adjusted Gross Margin by deducting the purchased cost of natural gas, propane and electricity and the cost of labor spent on direct revenue-producing activities from operating revenues. The costs included in Adjusted Gross Margin exclude depreciation and amortization and certain costs presented in operations and maintenance expenses in accordance with regulatory requirements. We calculate Adjusted Net Income and Adjusted EPS by deducting non-recurring costs and expenses associated with significant acquisitions that may affect the comparison of period-over-period results. These non-GAAP financial measures are not in accordance with, or an alternative to, GAAP and should be considered in addition to, and not as a substitute for, the comparable GAAP measures. The Company believes that these non-GAAP financial measures are useful and meaningful to investors as a basis for making investment decisions, and provide investors with information that demonstrates the profitability achieved by the Company under allowed rates for regulated energy operations and under the Company's competitive pricing structures for unregulated energy operations. The Company's management uses these non-GAAP financial measures in assessing a business unit's and the overall Company performance. Other companies may calculate these non-GAAP financial measures in a different manner. Unless otherwise noted, EPS and Adjusted EPS information are presented on a diluted basis. The following tables reconcile Gross Margin, Net Income, and EPS, all as defined under GAAP, to our non-GAAP financial measures of Adjusted Gross Margin, Adjusted Net Income and Adjusted EPS for the three and nine months ended September 30, 2025 and 2024: Adjusted Gross Margin For the Three Months Ended September 30, 2025 (in millions) Regulated Energy Unregulated Energy Other Businesses and Eliminations Total Operating Revenues $ 146.4 $ 40.7 $ (7.5) $ 179.6 Cost of Sales: Natural gas, propane and electric costs (31.7) (18.3) 7.6 (42.4) Depreciation & amortization (18.2) (5.1) — (23.3) Operations & maintenance expenses (1) (12.6) (9.5) — (22.1) Gross Margin (GAAP) 83.9 7.8 0.1 91.8 Operations & maintenance expenses (1) 12.6 9.5 — 22.1 Depreciation & amortization 18.2 5.1 — 23.3 Adjusted Gross Margin (Non-GAAP) $ 114.7 $ 22.4 $ 0.1 $ 137.2 33 Table of Contents For the Three Months Ended September 30, 2024 (in millions) Regulated Energy Unregulated Energy Other Businesses and Eliminations Total Operating Revenues $ 130.6 $ 35.6 $ (6.0) $ 160.2 Cost of Sales: Natural gas, propane and electric costs (28.4) (15.8) 6.0 (38.2) Depreciation & amortization (12.3) (4.5) — (16.8) Operations & maintenance expenses (1) (10.7) (8.1) — (18.8) Gross Margin (GAAP) 79.2 7.2 — 86.4 Operations & maintenance expenses (1) 10.7 8.1 — 18.8 Depreciation & amortization 12.3 4.5 — 16.8 Adjusted Gross Margin (Non-GAAP) $ 102.2 $ 19.8 $ — $ 122.0 For the Nine Months Ended September 30, 2025 (in millions) Regulated Energy Unregulated Energy Other Businesses and Eliminations Total Operating Revenues $ 497.8 $ 195.3 $ (22.0) $ 671.1 Cost of Sales: Natural gas, propane and electric costs (137.3) (93.4) 22.0 (208.7) Depreciation & amortization (52.6) (15.1) — (67.7) Operations & maintenance expenses (1) (40.5) (29.0) (0.1) (69.6) Gross Margin (GAAP) 267.4 57.8 (0.1) 325.1 Operations & maintenance expenses (1) 40.5 29.0 0.1 69.6 Depreciation & amortization 52.6 15.1 — 67.7 Adjusted Gross Margin (Non-GAAP) $ 360.5 $ 101.9 $ — $ 462.4 For the Nine Months Ended September 30, 2024 (in millions) Regulated Energy Unregulated Energy Other Businesses and Eliminations Total Operating Revenues $ 429.7 $ 160.1 $ (17.6) $ 572.2 Cost of Sales: Natural gas, propane and electric costs (105.7) (70.9) 17.5 (159.1) Depreciation & amortization (39.5) (12.2) — (51.7) Operations & maintenance expenses (1) (35.7) (24.4) — (60.1) Gross Margin (GAAP) 248.8 52.6 (0.1) 301.3 Operations & maintenance expenses (1) 35.7 24.4 — 60.1 Depreciation & amortization 39.5 12.2 — 51.7 Adjusted Gross Margin (Non-GAAP) $ 324.0 $ 89.2 $ (0.1) $ 413.1 (1) Operations & maintenance expenses within the condensed consolidated statements of income are presented in accordance with regulatory requirements and to provide comparability within the industry. Operations & maintenance expenses which are deemed to be directly attributable to revenue producing activities have been separately presented above in order to calculate Gross Margin as defined under GAAP. 34 Table of Contents 2025 to 2024 Gross Margin (GAAP) Variance – Regulated Energy Gross Margin (GAAP) for the Regulated Energy segment for the quarter ended September 30, 2025 was $83.9 million, an increase of $4.7 million, or 5.9 percent, compared to the same period in 2024. The increase in gross margin largely reflects incremental margin from regulatory initiatives and infrastructure programs, pipeline expansion projects, and organic growth in our natural gas distribution businesses. Gross Margin (GAAP) for the Regulated Energy segment for the nine months ended September 30, 2025 was $267.4 million, an increase of $18.6 million, or 7.5 percent, compared to the same period in 2024. The increase in gross margin largely reflects incremental margin from regulatory initiatives and infrastructure programs, pipeline expansion projects, and organic growth in our natural gas distribution businesses. 2025 to 2024 Gross Margin (GAAP) Variance – Unregulated Energy Gross Margin (GAAP) for the Unregulated Energy segment for the quarter ended September 30, 2025 was $7.8 million, an increase of $0.6 million, or 8.3 percent, compared to the same period in 2024. The increase in gross margin was primarily attributable to higher CNG, RNG, and LNG services compared to the prior-year period and increased performance from Aspire Energy, partially offset by lower results from our propane distribution business. Gross Margin (GAAP) for the Unregulated Energy segment for the nine months ended September 30, 2025 was $57.8 million, an increase of $5.2 million, or 9.9 percent, compared to the same period in 2024. The increase in gross margin was primarily attributable to greater demand for CNG, RNG and LNG services, higher results from our propane distribution business largely attributable to increased customer consumption from colder year-over-year weather in our Delmarva service territory, and increased performance from Aspire Energy. Adjusted Net Income and Adjusted EPS Three Months Ended Nine Months Ended September 30, September 30, (dollars in millions, shares in thousands (except per share data)) 2025 2024 2025 2024 Net Income (GAAP) $ 19.4 $ 17.5 $ 94.2 $ 81.9 FCG transaction and transition-related expenses, net (1) 0.1 0.6 0.7 2.3 Adjusted Net Income (Non-GAAP) $ 19.5 $ 18.1 $ 94.9 $ 84.2 Weighted average common shares outstanding - diluted 23,629 22,564 23,360 22,402 Earnings Per Share - Diluted (GAAP) $ 0.82 $ 0.78 $ 4.03 $ 3.66 FCG transaction and transition-related expenses, net (1) — 0.02 0.03 0.10 Adjusted Earnings Per Share - Diluted (Non-GAAP) $ 0.82 $ 0.80 $ 4.06 $ 3.76 (1) Transaction and transition-related expenses represent non-recurring costs incurred attributable to the acquisition and integration of FCG including, but not limited to, transition services, consulting, system integration, rebranding, and legal fees. 2025 to 2024 Net Income (GAAP) Variance Net income (GAAP) for the quarter ended September 30, 2025 was $ 19.4 million, or $0.82 per share, compared to $17.5 million, or $ 0.78 per share, for the same quarter of 2024. Net income for the three months ended September 30, 2025 and 2024, included $0.1 million and $0.6 million, respectively, of transaction and transition-related expenses in connection with the acquisition and integration of FCG. Excluding these costs, net income increased by $1.4 million or 7.7 percent compared to the prior-year period. Net income (GAAP) for the nine months ended September 30, 2025 was $94.2 million, or $4.03 per share, compared to $81.9 million, or $3.66 per share, for the same quarter of 2024. Net income for the nine months ended September 30, 2025 and 2024, included $0.7 million and $2.3 million, respectively, of transaction and transition-related expenses in connection with the acquisition and integration of FCG. Excluding these costs, net income increased by $10.7 million or 12.7 percent compared to the prior-year period. 35 Table of Contents Results of Operations for the Three and Nine Months Ended September 30, 2025 Operational Highlights Our adjusted net income for the three months ended September 30, 2025 was $19.5 million, or $0.82 per share, compared to $18.1 million, or $0.80 per share, for the same quarter of 2024. Operating income for the third quarter of 2025 was $45.0 million, an increase of $4.1 million compared to the same period in 2024. Excluding transaction and transition-related expenses associated with the acquisition and integration of FCG, operating income increased $3.5 million or 8.4 percent compared to the prior-year period. The increase in adjusted gross margin in the third quarter of 2025 was driven by incremental margin from regulatory initiatives and infrastructure programs, natural gas growth and transmission expansion projects, and increased demand for CNG, RNG, and LNG services. The increase in operating expenses was driven largely by higher depreciation attributable to growth projects and the absence of an RSAM adjustment from FCG (which represented a $3.2 million benefit in the third quarter of 2024). Higher expenses associated with facilities, maintenance and outside services also contributed to the increase. 36 Table of Contents Three Months Ended September 30, Increase 2025 2024 (Decrease) (in millions, except shares (thousands) and per share data) Adjusted Gross Margin Regulated Energy segment $ 114.7 $ 102.2 $ 12.5 Unregulated Energy segment 22.4 19.8 2.6 Other Businesses and Eliminations 0.1 — 0.1 Total Adjusted Gross Margin $ 137.2 $ 122.0 $ 15.2 Operating Income (Loss) Regulated Energy segment $ 48.9 $ 44.0 $ 4.9 Unregulated Energy segment (3.9) (3.1) (0.8) Other Businesses and Eliminations — — — Total Operating Income 45.0 40.9 4.1 Other income, net 0.2 0.5 (0.3) Interest charges 18.2 17.1 1.1 Income Before Income Taxes 27.0 24.3 2.7 Income taxes 7.6 6.8 0.8 Net Income $ 19.4 $ 17.5 $ 1.9 Weighted Average Common Shares Outstanding: Basic 23,526 22,501 1,025 Diluted 23,629 22,564 1,065 Earnings Per Share of Common Stock Basic $ 0.82 $ 0.78 $ 0.04 Diluted $ 0.82 $ 0.78 $ 0.04 Adjusted Net Income and Adjusted Earnings Per Share Net Income (GAAP) $ 19.4 $ 17.5 $ 1.9 FCG transaction and transition-related expenses, net (1) 0.1 0.6 (0.5) Adjusted Net Income (Non-GAAP) $ 19.5 $ 18.1 $ 1.4 Earnings Per Share - Diluted (GAAP) $ 0.82 $ 0.78 $ 0.04 FCG transaction and transition-related expenses, net (1) — 0.02 (0.02) Adjusted Earnings Per Share - Diluted (Non-GAAP) $ 0.82 $ 0.80 $ 0.02 (1) Transaction and transition-related expenses represent costs incurred attributable to the acquisition and integration of FCG including, but not limited to, transition services, consulting, system integration, rebranding and legal fees. 37 Table of Contents Key variances between the third quarter of 2024 and 2025 included: (in millions, except per share data) Pre-tax Income Net Income Earnings Per Share Third Quarter of 2024 Adjusted Results (1) $ 25.1 $ 18.1 $ 0.80 Change in Adjusted Gross Margins: Natural gas transmission service expansions, including interim services (2) 5.6 4.0 0.17 Contributions from regulated infrastructure programs (2) 3.9 2.8 0.12 Rate changes associated with recent rate case activities (2) 3.6 2.6 0.11 Increased CNG/RNG/LNG services (2) 3.1 2.2 0.09 Natural gas growth (excluding service expansions) 1.5 1.1 0.05 Increased Aspire Energy performance - rate changes and gathering fees 0.4 0.3 0.01 Changes in customer consumption (0.9) (0.6) (0.03) Change in propane margins and service fees (0.7) (0.5) (0.02) 16.5 11.9 0.50 Increased Operating Expenses (Excluding Natural Gas, Propane, and Electric Costs): Depreciation, amortization and property tax costs (7.7) (5.6) (0.24) Facilities expenses, maintenance costs and outside services (3.4) (2.5) (0.10) Payroll, benefits and other employee-related expenses (0.6) (0.4) (0.01) Insurance related costs (0.4) (0.3) (0.01) (12.1) (8.8) (0.36) Interest charges (1.1) (0.8) (0.03) Increase in shares outstanding due to 2024 and 2025 equity offerings (3) — — (0.04) Net other changes (1.3) (0.9) (0.05) (2.4) (1.7) (0.12) Third Quarter of 2025 Adjusted Results (1) $ 27.1 $ 19.5 $ 0.82 (1) Transaction and transition-related expenses attributable to the acquisition and integration of FCG have been excluded from the Company’s non-GAAP measures of adjusted net income and adjusted EPS. See reconciliations above for a detailed comparison to the related GAAP measures. (2) Refer to Major Projects and Initiatives table for additional information. (3) Reflects the impact of common shares issued under the DRIP and ATM program. 38 Table of Contents Our adjusted net income for the nine months ended September 30, 2025 was $94.9 million, or $4.06 per share, compared to $84.2 million, or $3.76 per share, for the same period of 2024. Operating income for the first nine months of 2025 was $182.1 million, an increase of $20.8 million compared to the same period in 2024. Excluding transaction and transition-related expenses associated with the acquisition and integration of FCG, operating income increased $18.7 million or 11.4 percent compared to the prior-year period. The increase in adjusted gross margin in the first nine months of 2025 was driven by incremental margin from regulatory initiatives and infrastructure programs, natural gas growth and transmission expansion projects, increased CNG, RNG and LNG services, and increased customer consumption resulting from year-over-year colder temperatures in our Mid-Atlantic and Ohio service territories. These increases were partially offset by reduced margin per gallon and related fees in our propane distribution business and a reduced volume of off-system sales and service fees. Higher operating expenses were driven largely by the absence of an RSAM adjustment from FCG (which represented an $8.9 million benefit during the first nine months of 2024) and higher depreciation attributable to growth projects. Higher facilities, maintenance and outside services, insurance, and payroll, benefits and other employee-related expenses compared to the prior-year period also contributed to the increase. 39 Table of Contents Nine Months Ended September 30, Increase 2025 2024 (Decrease) (in millions, except shares (thousands) and per share data) Adjusted Gross Margin Regulated Energy segment $ 360.5 $ 324.0 $ 36.5 Unregulated Energy segment 101.9 89.2 12.7 Other Businesses and Eliminations — (0.1) 0.1 Total Adjusted Gross Margin $ 462.4 $ 413.1 $ 49.3 Operating Income Regulated Energy segment $ 161.2 $ 142.6 $ 18.6 Unregulated Energy segment 20.9 18.7 2.2 Other Businesses and Eliminations — — — Total Operating Income 182.1 161.3 20.8 Other income, net 1.2 1.7 (0.5) Interest charges 54.1 50.9 3.2 Income Before Income Taxes 129.2 112.1 17.1 Income taxes 35.0 30.2 4.8 Net Income $ 94.2 $ 81.9 $ 12.3 Weighted Average Common Shares Outstanding: Basic 23,265 22,346 919 Diluted 23,360 22,402 958 Earnings Per Share of Common Stock Basic $ 4.05 $ 3.67 $ 0.38 Diluted $ 4.03 $ 3.66 $ 0.37 Adjusted Net Income and Adjusted Earnings Per Share Net Income (GAAP) $ 94.2 $ 81.9 $ 12.3 FCG transaction and transition-related expenses, net (1) 0.7 2.3 (1.6) Adjusted Net Income (Non-GAAP) $ 94.9 $ 84.2 $ 10.7 Earnings Per Share - Diluted (GAAP) $ 4.03 $ 3.66 $ 0.37 FCG transaction and transition-related expenses, net (1) 0.03 0.10 (0.07) Adjusted Earnings Per Share - Diluted (Non-GAAP) $ 4.06 $ 3.76 $ 0.30 (1) Transaction and transition-related expenses represent costs incurred attributable to the acquisition and integration of FCG including, but not limited to, transition services, consulting, system integration, rebranding and legal fees. 40 Table of Contents Key variances between the nine months ended September 30, 2024 and September 30, 2025 included: (in millions, except per share data) Pre-tax Income Net Income Earnings Per Share Nine months ended September 30, 2024 Adjusted Results (1) $ 115.2 $ 84.2 $ 3.76 Change in Adjusted Gross Margins: Natural gas transmission service expansions, including interim services (2) 11.7 8.5 0.37 Contributions from regulated infrastructure programs (2) 11.0 8.0 0.34 Increased CNG/RNG/LNG services (2) 10.1 7.3 0.31 Rate changes associated with recent rate case activities (2) 9.2 6.7 0.29 Natural gas growth including conversions (excluding service expansions) 5.5 4.0 0.17 Changes in customer consumption 4.8 3.5 0.15 Increased Aspire Energy performance - rate changes and gathering fees 0.2 0.2 0.01 Change in propane margins and service fees (1.3) (0.9) (0.04) Change in service fees and off-system sales (0.7) (0.5) (0.02) 50.5 36.8 1.58 Increased Operating Expenses (Excluding Natural Gas, Propane, and Electric Costs): Depreciation, amortization and property taxes (17.4) (12.7) (0.54) Facilities expenses, maintenance costs and outside services (8.2) (6.0) (0.26) Payroll, benefits and other employee-related expenses (3.8) (2.8) (0.12) Insurance related costs (0.7) (0.5) (0.02) (30.1) (22.0) (0.94) Interest charges (3.2) (2.4) (0.10) Increase in shares outstanding due to 2024 and 2025 equity offerings (3) — — (0.17) Net other changes (2.3) (1.7) (0.07) (5.5) (4.1) (0.34) Nine months ended September 30, 2025 Adjusted Results (1) $ 130.1 $ 94.9 $ 4.06 (1) Transaction and transition-related expenses attributable to the acquisition and integration of FCG have been excluded from the Company’s non-GAAP measures of adjusted net income and adjusted EPS. See reconciliations above for a detailed comparison to the related GAAP measures. (2) Refer to Major Projects and Initiatives table for additional information. (3) Reflects the impact of common shares issued under the DRIP and ATM program. 41 Table of Contents Summary of Key Factors Recently Completed and Ongoing Major Projects and Initiatives We continuously pursue and develop additional projects and regulatory initiatives to serve existing and new customers, further grow our businesses and earnings, and increase shareholder value. The following table includes all major projects and initiatives that are currently underway or recently completed. Our practice is to add incremental margin associated with new projects and regulatory initiatives to this table once negotiations or details are substantially final and/or the associated earnings can be estimated. Major projects and initiatives that have generated consistent year-over-year adjusted gross margin contributions are removed from the table at the beginning of the next calendar year. Adjusted Gross Margin Three Months Ended Nine Months Ended Year Ended Estimate for September 30, September 30, December 31, Fiscal (in millions) 2025 2024 2025 2024 2024 2025 2026 Pipeline Expansions: St. Cloud / Twin Lakes Expansion $ 1.0 $ 0.1 $ 1.9 $ 0.4 $ 0.6 $ 2.8 $ 3.8 Wildlight 0.5 0.6 1.5 1.0 1.5 3.0 4.3 Newberry 0.6 0.6 1.8 0.7 1.4 2.6 2.6 Worcester Resiliency Upgrade — — — — — — 10.2 Boynton Beach 0.9 — 2.3 — — 3.0 3.4 New Smyrna Beach 0.6 — 0.9 — — 1.6 2.6 Central Florida Reinforcement 0.9 — 1.5 — 0.1 2.6 4.3 Warwick 0.5 — 1.5 — 0.4 1.9 1.9 Renewable Natural Gas Supply Projects 1.0 — 1.5 — — 2.5 5.4 Miami Inner Loop 0.9 — 0.9 — — 2.8 7.6 Duncan Plains — — — — — — — Total Pipeline Expansions 6.9 1.3 13.8 2.1 4.0 22.8 46.1 CNG/RNG/LNG Transportation and Infrastructure 6.6 3.5 20.5 10.4 16.4 25.5 26.5 Regulatory Initiatives: Florida GUARD program 1.9 0.9 5.1 2.4 3.6 6.9 9.9 FCG SAFE Program 2.3 1.1 6.2 2.2 3.8 8.5 12.0 Capital Cost Surcharge Programs 1.4 0.8 4.3 2.4 3.2 5.7 7.1 Electric Storm Protection Plan 1.8 0.7 4.4 2.0 3.2 5.9 8.8 Maryland Rate Case 0.5 — 1.1 — — 1.5 3.5 Delaware Rate Case (1) 0.7 — 2.9 — 0.6 4.5 6.1 Electric Rate Case (1) 2.4 — 5.2 — 0.3 7.1 8.6 Total Regulatory Initiatives 11.0 3.5 29.2 9.0 14.7 40.1 56.0 Total $ 24.5 $ 8.3 $ 63.5 $ 21.5 $ 35.1 $ 88.4 $ 128.6 (1) Includes adjusted gross margin attributable to interim rates during 2024 and 2025. See additional information provided below. Detailed Discussion of Major Projects and Initiatives Pipeline Expansions St. Cloud / Twin Lakes Expansion In July 2022, Peninsula Pipeline filed a petition with the Florida PSC for approval of its Transportation Service Agreement with FPU for an additional 2,400 Dts/d of firm service in the St. Cloud, Florida area. As part of this agreement, Peninsula Pipeline constructed a pipeline extension and regulator station for FPU. The extension supports new incremental load due to growth in the area, including providing service, most immediately, to the residential development, Twin Lakes. The expansion also improves reliability and provides operational benefits to FPU’s existing distribution system in the area, supporting future growth. This project was placed into service during July 2023 and generated additional adjusted gross margin of $0.9 million 42 Table of Contents and $1.5 million for the three and nine months ended September 30, 2025. We expect this extension to generate annual adjusted gross margin of approximately $0.6 million in 2025 and annually thereafter. In February 2024, Peninsula Pipeline filed a petition with the Florida PSC for approval of an amendment to its Transportation Service Agreement with FPU for a project that will support additional supply to communities in the St. Cloud, Florida area. The project is driven by the need to expand gas service to future communities that are expected in that area. Peninsula Pipeline will construct pipeline expansions that will allow FPU to serve the expected new growth. The expansion will provide FPU with an additional 10,000 Dts/d. The Florida PSC approved the project in May 2024, and it is expected to be complete in the fourth quarter of 2025. We expect this expansion to generate annual adjusted gross margin of approximately $2.2 million in 2025 and $3.2 million annually thereafter. Wildlight Expansion In August 2022, Peninsula Pipeline and FPU filed a joint petition with the Florida PSC for approval of its Transportation Service Agreement associated with the Wildlight planned community located in Nassau County, Florida. The petition was approved by the Florida PSC in November 2022. The project enables us to meet the significant growing demand for service in Yulee, Florida. The agreement enables us to construct the project during the build-out of the community and charge the reservation rate as each phase of the project goes into service. Construction of the pipeline facilities will occur in two separate phases. Phase one consists of three extensions with associated facilities, and a gas injection interconnect with associated facilities. Phase two will consist of two additional pipeline extensions. The various phases of the project commenced in the first quarter of 2023, with construction on the overall project continuing through 2025. The project generated gross margin of $0.5 million for the three months ended September 30, 2025 and additional adjusted gross margin of $0.5 million for the nine months ended September 30, 2025. It is expected to contribute adjusted gross margin of approximately $3.0 million in 2025 and $4.3 million annually thereafter. Newberry Expansion In April 2023, Peninsula Pipeline filed a petition with the Florida PSC for approval of its Transportation Service Agreement with FPU for an additional 8,000 Dts/d of firm service in the Newberry, Florida area. The petition was approved by the Florida PSC in the third quarter of 2023. Peninsula Pipeline will construct a pipeline extension, which will be used by FPU to support the development of a natural gas distribution system to provide gas service to the City of Newberry. A filing to address the acquisition and conversion of existing Company-owned propane community gas systems in Newberry was made in November 2023. The Florida PSC approved it in April 2024. Conversions of the community gas systems commenced in the second quarter of 2024 and are projected to be complete in the fourth quarter of 2025. The project generated gross margin of $0.6 million for the three months ended September 30, 2025 and additional adjusted gross margin of $1.1 million for the nine months ended September 30, 2025. It is expected to contribute adjusted gross margin of approximately $2.6 million in 2025 and annually thereafter. Worcester Resiliency Upgrade In August 2023, Eastern Shore filed an application with the FERC requesting authorization to construct the Worcester Resiliency Upgrade, which consists of a mixture of storage and transmission facilities in Sussex County, Delaware and Wicomico, Worcester, and Somerset Counties in Maryland. The project will provide long-term incremental supply necessary to support the growing demand of the participating shippers. In January 2025, the FERC approved the project. Construction has commenced and the project is expected to be placed into service in mid-2026 dependent on final FERC approval. In June 2025, Eastern Shore filed a limited amended application with the FERC requesting revised initial transportation rates for the project. The revised rates reflected increased capital costs associated with unanticipated changes in global markets and supply chains, including the availability of skilled laborers with the requisite certifications to work on this project. Eastern Shore requested expedited action by the FERC in relation to this matter and an approved order was issued in July 2025. The project is expected to generate $10.2 million in adjusted gross margin in 2026 and $17.6 million in 2027 and thereafter. East Coast Reinforcement Projects (Boynton Beach and New Smyrna Beach) In December 2023, Peninsula Pipeline filed a petition with the Florida PSC for approval of its Transportation Service Agreements with FPU for projects that will provide additional supply to coastal communities on the East Coast of Florida, which are experiencing significant population growth. Peninsula Pipeline proposed several pipeline extensions to support FPU’s distribution system in the areas of Boynton Beach and New Smyrna Beach with an additional 15,000 Dts/d and 3,400 Dts/d, respectively. The Florida PSC approved the projects in March 2024. New Smyrna Beach was placed into service during May 2025 and construction is projected to be complete for Boynton Beach in the fourth quarter of 2025. The projects generated adjusted gross margin of $1.5 million and $3.2 million for the three and nine months ended September 30, 2025, respectively, and are expected to contribute adjusted gross margin of approximately $4.6 million in 2025 and $6.0 million annually thereafter. 43 Table of Contents Central Florida Reinforcement Projects (Plant City and Lake Mattie) In February 2024, Peninsula Pipeline filed a petition with the Florida PSC for approval of its Transportation Service Agreements with FPU for projects that will support additional supply to communities located in Central Florida which are also experiencing significant population growth. Peninsula Pipeline proposed to construct several pipeline extensions which will support FPU’s distribution system around the Plant City and Lake Mattie areas of Florida with an additional 5,000 Dts/d and 8,700 Dts/d, respectively. The Florida PSC approved the projects in May 2024 . The Plant City project was completed in the fourth quarter of 2024, and the Lake Mattie project went into service in July 2025. The project generated additional adjusted gross margin of $0.9 million and $1.5 million for the three and nine months ended September 30, 2025, respectively, and both projects are expected to contribute total adjusted gross margin of approximately $2.6 million in 2025 and $4.3 million annually thereafter. Warwick Pipeline Project In July 2024, we announced plans to extend Eastern Shore's transmission deliverability by constructing an additional 4.4 miles of six inch steel pipeline. The project will reinforce the supply and growth for our Delaware division distribution system and expand natural gas service further into Maryland for anticipated future growth. This project was placed into service during the fourth quarter of 2024, generated additional adjusted gross margin of $0.5 million and $1.5 million for the three and nine months ended September 30, 2025, respectively, and is expected to contribute adjusted gross margin of approximately $1.9 million in 2025 and annually thereafter. Renewable Natural Gas Supply Projects In February 2024, Peninsula Pipeline filed a petition with the Florida PSC for approval of Transportation Service Agreements with FCG for projects that will support the transportation of additional renewable energy supply to FCG. The projects, located in Florida’s Brevard, Indian River and Miami-Dade counties, will bring renewable natural gas produced from local landfills into FCG’s natural gas distribution system. Peninsula Pipeline will construct several pipeline extensions which will support FCG's distribution system in Brevard County, Indian River County, and Miami-Dade County. Benefits of these projects include increased gas supply to serve expected FCG growth, strengthened system reliability and additional system flexibility. The Florida PSC approved the petition at its July 2024 meeting with the projects estimated to be completed in the first half of 2026. In October 2025, the Florida PSC approved amendments to the Transportation Service Agreements that were filed to include Peninsula Pipeline as a party to the related interconnection agreements. These three renewable projects generated adjusted gross margin of $1.0 million and $1.5 million for the three and nine months ended September 30, 2025, respectively, and are projected to generate total adjusted gross margin of approximately $2.5 million in 2025 and $5.4 million annually thereafter. Miami Inner Loop Pipeline Projects In September 2024, Peninsula Pipeline filed a petition with the Florida PSC for approval of the Transportation Service Agreement with FCG for a series of projects that will enhance the infrastructure in Miami-Dade County. The proposed expansion consists of the development of several pipeline projects to support growth and FCG's distribution system in the area, as well as enhance FCG's access to gas from various points in the Miami-Dade County area. The expansion was approved in February 2025 and interim services began in August 2025 with permanent facilities expected to be in service by the second quarter of 2026. The project generated adjusted gross margin of $0.9 million for the three and nine months ended September 30, 2025 and is expected to contribute adjusted gross margin of approximately $2.8 million in 2025 and $7.6 million annually thereafter. Pioneer Supply Header Pipeline Project In March 2024, Peninsula Pipeline filed a petition with the Florida PSC for its approval of Firm Transportation Service Agreements with both FCG and FPU for a project that will support greater supply growth of natural gas service in southeast Florida. The project consists of the transfer of a pipeline asset from FCG to Peninsula Pipeline. Peninsula Pipeline will proceed to provide transportation service to both FCG and FPU using the pipeline asset, which supports continued customer growth and system reinforcement of these distribution systems. The Florida PSC approved the petition in July 2024 and the project was completed in September 2024. Duncan Plains Pipeline Project In July 2025, Aspire Energy Express entered into an agreement with American Electric Power to construct and operate an intrastate natural gas pipeline in central Ohio to serve a new fuel-cell facility, which will provide on-site electric power to a data center. This new transmission infrastructure is expected to be in service in the first half of 2027. 44 Table of Contents CNG/RNG/LNG Transportation and Infrastructure We have made a commitment to meet customer demand for CNG, RNG and LNG in the markets we serve. This has included making investments within Marlin Gas Services to be able to transport these products through its virtual pipeline fleet to customers. To date, we have also made an infrastructure investment in Ohio, enabling RNG to fuel a third-party landfill fleet and to transport RNG to end use customers off our pipeline system. We are also involved in various other projects, all at various stages and all with different opportunities to participate across the energy value chain. In many of these projects, Marlin will play a key role in ensuring the RNG is transported to one of our many pipeline systems where it will be injected. We include our RNG transportation services and infrastructure related adjusted gross margin from across the organization in combination with our CNG and LNG projects. We estimate annual adjusted gross margin, including amounts attributable to the Full Circle Dairy and Noble Road projects described below, of approximately $25.5 million in 2025 and $26.5 million in 2026 for these transportation related services, with potential for additional growth in future years. Full Circle Dairy In February 2023, we announced plans to construct, own and operate a dairy manure RNG facility at Full Circle Dairy in Madison County, Florida. The project consists of a facility converting dairy manure to RNG and transportation assets to bring the gas to market. The first injection of RNG occurred in the second quarter of 2024. Noble Road Landfill RNG Project In October 2021, Aspire Energy completed construction of its Noble Road Landfill RNG pipeline project, a 33.1-mile pipeline, which transports RNG generated from the Noble Road landfill to Aspire Energy’s pipeline system, displacing conventionally produced natural gas. In conjunction with this expansion, Aspire Energy also upgraded an existing compressor station and installed two new metering and regulation sites. The RNG volume represents more than 10 percent of Aspire Energy’s gas gathering volumes. Regulatory Initiatives Florida GUARD Program In February 2023, FPU filed a petition with the Florida PSC for approval of the GUARD program. GUARD is a ten-year program to enhance the safety, reliability, and accessibility of portions of our natural gas distribution system. We identified various categories of projects to be included in GUARD, which include the relocation of mains and service lines located in rear easements and other difficult to access areas to the front of the street, the replacement of problematic distribution mains, service lines, and maintenance and repair equipment and system reliability projects. In August 2023, the Florida PSC approved the GUARD program, which included $205.0 million of capital expenditures projected to be spent over a 10-year period. For t he three and nine months ended September 30, 2025 , there was $1.0 million and $2.7 million, respectively, of incremental adjusted gross margin generated pursuant to the program. The program is expected to generate $6.9 million of adjusted gross margin in 2025 and $9.9 million in 2026. FCG SAFE Program In June 2023, the Florida PSC issued the approval order for the continuation of the SAFE program beyond its 2025 expiration date and inclusion of 150 miles of additional mains and services located in rear property easements. The SAFE program is designed to relocate certain mains and facilities associated with rear lot easements to street front locations to improve FCG's ability to inspect and maintain the facilities and reduce opportunities for damage and theft. In the same order, the Florida PSC approved a replacement of 160 miles of pipe that was used in the 1970s and 1980s and shown through industry research to exhibit premature failure in the form of cracking. The program includes projected capital expenditures of $205.0 million over a 10-year period. For t he three and nine months ended September 30, 2025 , there was $1.2 million and $4.0 million, respectively, of incremental adjusted gross margin generated pursuant to the program. The program is expected to generate $8.5 million of adjusted gross margin in 2025 and $12.0 million in 2026. In April 2024, FCG filed a petition with the Florida PSC to more closely align the SAFE Program with FPU's GUARD program. Specifically, the requested modifications will enable FCG to accelerate remediation related to problematic pipe and facilities consisting of obsolete and exposed pipe. These efforts will serve to improve the safety and reliability of service to FCG's customers, and the modifications will result in an estimated additional $50.0 million in capital expenditures associated with the SAFE Program which would increase the total projected capital expenditures to approximately $255.0 million over a 10-year period. The Florida PSC approved the modifications in September 2024. 45 Table of Contents Capital Cost Surcharge Programs In December 2024, Eastern Shore submitted a filing with the FERC regarding a capital cost surcharge to recover capital costs associated with the replacement of existing Eastern Shore facilities because of mandated highway relocation projects as well as compliance with PHMSA regulation. The capital cost surcharge mechanism was approved in Eastern Shore's last rate case. In conjunction with the filing of this surcharge, a cumulative adjustment to the existing surcharge to reflect additional depreciation was included. The FERC issued an order approving the surcharge as filed in December 2024. The combined revised surcharge became effective January 1, 2025. In March 2025, Eastern Shore submitted an annual true-up filing with the FERC regarding a capital cost surcharge to recover capital costs associated with the replacement of existing Eastern Shore facilities because of mandated highway relocation projects as well as compliance with a PHMSA regulation. There was no impact to the currently effective surcharge as a result of this filing. The FERC issued an order approving the surcharge as filed effective April 1, 2025. For t he three and nine months ended September 30, 2025 , there was $0.6 million and $1.9 million, respectively, of incremental adjusted gross margin generated pursuant to the program. Eastern Shore expects to generate adjusted gross margin of approximately $5.7 million in 2025 and $7.1 million in 2026 from relocation projects, which is ultimately dependent upon the timing of filings and the completion of construction. Storm Protection Plan In 2020, the Florida PSC implemented the Storm Protection Plan ("SPP") and Storm Protection Plan Cost Recovery Clause ("SPPCRC"), which require electric utilities to petition the Florida PSC for approval of a Transmission and Distribution Storm Protection Plan that covers the utility’s immediate 10-year planning period with updates to the plan at least every 3 years. The SPPCRC rules allow the utility to file for recovery of associated costs related to its SPP. Our Florida electric distribution operation's SPP and SPPCRC were filed d uring the first quarter of 2022 and approved in the fourth quarter of 2022, with modifications, by the Florida PSC. In October 2024, the Florida PSC approved the Company's projected 2025 SPP costs for both capital and operating expenses. For the three and nine months ended September 30, 2025, this initiative generated additional adjusted gross margin of $1.1 million and $2.4 million, respectively, and is expected to generate $5.9 million of adjusted gross margin in 2025 and $8.8 million in 2026. We expect continued investment under the SPP going forward. Maryland Natural Gas Rate Case In January 2024, our natural gas distribution businesses in Maryland, CUC-Maryland Division, Sandpiper Energy, Inc., and Elkton Gas Company (collectively, the “Maryland natural gas distribution businesses”) filed a joint application for a natural gas rate case with the Maryland PSC. In connection with the application, we sought approval of the following: (i) permanent rate relief of approximately $6.9 million with a ROE of 11.5 percent; (ii) authorization to make certain changes to tariffs to include a unified rate structure and to consolidate the Maryland natural gas distribution businesses; and (iii) authorization to establish a rider for recovery of the costs associated with our new technology systems. In August 2024, the Maryland natural gas distribution businesses, the Maryland OPC and PSC staff reached a settlement which provided for, among other things, an increase in annual base rates of $2.6 million. In September 2024, the Maryland Public Utility Judge issued an order approving the related settlement agreement in part. The $2.6 million increase in annual base rates was approved and the Company filed a Phase II filing in November 2024 to determine rate design across the Maryland natural gas distribution businesses, consolidation of the applicable tariffs and recovery of technology costs. The hearing was held in March 2025, during which Phase II was approved, including an additional $0.9 million in revenue requirement, for a total cumulative increase of $3.5 million. A final order was issued in April 2025 and included approval of the consolidation of the operations and the assets of CUC-Maryland Division, Sandpiper Energy, and Elkton Gas into one entity which was renamed and operates as Chesapeake Utilities of Maryland, Inc. For t he three and nine months ended September 30, 2025 , there was $0.5 million and $1.1 million, respectively, of incremental adjusted gross margin generated and t he proceeding is expected to result in additional adjusted gross margin of approximately $1.5 million in 2025 and $3.5 million annually thereafter. Maryland Natural Gas Depreciation Study In January 2024, our natural gas distribution businesses in Maryland filed a joint petition for approval of its proposed unified depreciation rates with the Maryland PSC. A settlement among the Company, PSC staff and the Maryland OPC was reached and the final order approving the related settlement agreement went into effect in July 2024, with new depreciation rates effective as of January 1, 2023. The approved depreciation rates resulted in an annual reduction in depreciation expense of approximately $1.2 million. Delaware Natural Gas Rate Case In August 2024, our Delaware natural gas division filed an application for a natural gas rate case with the Delaware PSC seeking approval of the following: (i) permanent rate relief of approximately $12.1 million with a ROE of 11.5 percent; (ii) proposed changes to depreciation rates which were part of a depreciation study also submitted with the filing; and (iii) authorization to make certain changes to tariffs. Annualized interim rates were approved by the Delaware PSC in the amount of $2.5 million and became effective in October 2024. A settlement among the Company, PSC staff and the Delaware Division of 46 Table of Contents the Public Advocate was reached and approved by the Delaware PSC in June 2025 providing an annual revenue increase of $6.1 million, as well as dividing the rate case into two phases. Rates set to recover the approved components of the increase were effective in March 2025. In October 2025, a settlement among the Company, PSC staff and the Delaware Division of the Public Advocate was reached for Phase II of the rate case addressing tariff-related changes including rate design and approved by the Delaware Public Service Commission with rates effective as of October 15, 2025. For t he three and nine months ended September 30, 2025 , there was $0.7 million and $2.9 million, respectively, of incremental adjusted gross margin generated and final rates are expected to generate approximately $4.5 million of adjusted gross margin in 2025 and $6.1 million in 2026. FPU Electric Rate Case In August 2024, our Florida Electric division filed a petition with the Florida PSC seeking a general base rate increase of $12.6 million with a ROE of 11.3 percent based on a 2025 projected test year. Annualized interim rates of approximately $1.8 million were approved with an effective date of November 1, 2024. In March 2025, the Florida PSC approved the permanent rate increase, but the order was subsequently protested. In May 2025, the Company reached a settlement agreement with the interested parties to resolve all outstanding issues in its current base rate case, which was filed as a joint motion for approval with the Florida PSC. This settlement which was approved by the Florida PSC in July 2025, provides for a total revenue increase of approximately $8.6 million on an annual basis, with $1.0 million of the increase deferred from the first year's base rate increase and recovered over three years. A step-up rate increase was also approved for up to $0.7 million, upon completion of the purchase and refurbishment of certain substations, which is expected in December 2026. The settlement was approved by the Florida PSC in July 2025. For the three and nine months ended September 30, 2025, there was $2.4 million and $5.2 million, respectively, of incremental adjusted gross margin generated and final rates are expected to generate approximately $7.1 million of adjusted gross margin in 2025 and $8.6 million in 2026. Other Major Factors Influencing Adjusted Gross Margin Weather Impact Weather was not a significant factor to adjusted gross margin in the third quarter of 2025 compared to the same period in 2024. For the nine months ended September 30, 2025, increased customer consumption, which includes the effects of colder weather conditions, largely in our Ohio and Delmarva service areas, compared to the prior-year period resulted in a $4.8 million increase in adjusted gross margin. The following table summarizes HDD and CDD variances from the 10-year average HDD/CDD ("Normal") for the three and nine months ended September 30, 2025 and 2024. 47 Table of Contents Three Months Ended Nine Months Ended September 30, September 30, 2025 2024 Variance 2025 2024 Variance Delmarva Peninsula Actual HDD 4 6 (2) 2,505 2,287 218 10-Year Average HDD ("Normal") 19 27 (8) 2,538 2,635 (97) Variance from Normal (15) (21) (33) (348) Florida Actual HDD 1 — 1 611 511 100 10-Year Average HDD ("Normal") 1 1 — 526 512 14 Variance from Normal — (1) 85 (1) Florida City Gas Actual HDD — — — 310 231 79 10-Year Average HDD ("Normal") — — — 234 239 (5) Variance from Normal — — 76 (8) Ohio Actual HDD 107 43 64 3,881 3,180 701 10-Year Average HDD ("Normal") 55 65 (10) 3,480 3,661 (181) Variance from Normal 52 (22) 401 (481) Florida Actual CDD 1,298 1,528 (230) 2,602 2,824 (222) 10-Year Average CDD ("Normal") 1,429 1,420 9 2,624 2,615 9 Variance from Normal (131) 108 (22) 209 Natural Gas Distribution Growth The average number of residential customers served on the Delmarva Peninsula increased by approximately 4.3 percent for both the three and nine months ended September 30, 2025. The average number of residential customers served by Florida Public Utilities Company increased by approximately 3.5 percent and 3.9 percent for the three and nine months ended September 30, 2025, respectively, while the average number of residential customers served by Florida City Gas increased by approximately 2.2 percent and 2.1 percent for the three and nine months ended September 30, 2025, respectively. The details of the adjusted gross margin increase are provided in the following table: Three Months Ended Nine Months Ended September 30, 2025 September 30, 2025 (in millions) Delmarva Peninsula Florida Delmarva Peninsula Florida Customer Growth: Residential $ 0.3 $ 0.6 $ 1.2 $ 2.4 Commercial and industrial — 0.6 0.2 1.7 Total Customer Growth $ 0.3 $ 1.2 $ 1.4 $ 4.1 48 Table of Contents Regulated Energy Segment For the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024: Three Months Ended September 30, 2025 2024 Change (in millions) Revenue $ 146.4 $ 130.6 $ 15.8 Regulated natural gas and electric costs 31.7 28.4 3.3 Adjusted gross margin (1) 114.7 102.2 12.5 Operations & maintenance 37.5 36.2 (1.3) Depreciation, amortization and property taxes (2) 26.9 19.8 (7.1) Other taxes 1.2 1.4 0.2 FCG transaction and transition-related expenses (3) 0.2 0.8 0.6 Total operating expenses 65.8 58.2 (7.6) Operating income $ 48.9 $ 44.0 $ 4.9 (1) Adjusted Gross Margin is a non-GAAP measure utilized by management to review business unit performance. For a more detailed discussion on the differences between Gross Margin (GAAP) and Adjusted Gross Margin, see the Reconciliation of GAAP to Non-GAAP Measures presented above. (2) Includes the absence of an RSAM adjustment from FCG which represented a $3.2 million benefit in the third quarter of 2024. (3) Transaction and transition-related expenses represent costs incurred attributable to the acquisition and integration of FCG including, but not limited to, transition services, consulting, system integration, rebranding and legal fees. Operating income for the Regulated Energy segment for the third quarter of 2025 was $48.9 million, an increase of $4.9 million, or 11.1 percent, over the same period in 2024. Excluding transaction and transition-related expenses associated with the acquisition and integration of FCG, operating income increased $4.3 million, or 9.6 percent, compared to the same period in 2024. Higher operating income reflects incremental margin from regulatory initiatives and infrastructure programs, pipeline expansion projects, and organic growth in our natural gas distribution businesses. Excluding the transaction and transition-related expenses described above, the increase in total operating expenses of $8.2 million was largely attributable to higher depreciation attributable to growth projects and the absence of a $3.2 million RSAM adjustment from FCG during the prior-year period and higher expenses associated with facilities, maintenance and outside services. These increases were partially offset by reduced payroll, benefits and other employee-related expenses during the quarter. Items contributing to the quarter-over-quarter increase in adjusted gross margin are listed in the following table: (in millions) Natural gas transmission service expansions, including interim services $ 5.6 Contributions from regulated infrastructure programs 3.9 Rate changes associated with recent rate case activities (1) 3.6 Natural gas growth including conversions (excluding service expansions) 1.5 Changes in customer consumption (0.9) Other variances (1.2) Quarter-over-quarter increase in adjusted gross margin $ 12.5 (1) Includes adjusted gross margin contributions from both interim and permanent base rates. Refer to Major Projects discussion for additional information. The following narrative discussion provides further detail and analysis of the significant items in the table above: Natural Gas Transmission Service Expansions, including interim services We generated increased adjusted gross margin of $5.6 million for the three months ended September 30, 2025 from natural gas transmission service expansions of Peninsula Pipeline and Eastern Shore. 49 Table of Contents Contributions from Regulated Infrastructure Programs Regulated infrastructure programs generated incremental adjusted gross margin of $3.9 million in the third quarter of 2025. The increase in adjusted gross margin was primarily related to FCG's SAFE program, Florida Natural Gas' GUARD program, Eastern Shore's Capital Cost Surcharge program, and FPU Electric's SPP. Refer to Note 5, Rates and Other Regulatory Activities , in the condensed consolidated financial statements for additional information. Rate Changes Associated with Recent Rate Case Activities Rate changes associated with the Delaware and Maryland natural gas rate cases and Florida Electric base rate case contributed additional adjusted gross margin of $3.6 million for the three months ended September 30, 2025. Refer to Note 5, Rates and Other Regulatory Activities , in the condensed consolidated financial statements for additional information. Natural Gas Distribution Customer Growth We generated additional adjusted gross margin of $1.5 million from natural gas customer growth. Adjusted gross margin increased by $1.2 million for our Florida natural gas distribution service territories and $0.3 million on the Delmarva Peninsula for the three months ended September 30, 2025, as compared to the same period in 2024, due to residential customer growth in Florida and on the Delmarva Peninsula, respectively, as well as growth attributable to commercial and industrial customers. Changes in Customer Consumption Customer consumption, inclusive of weather-related consumption, reduced adjusted gross margin by $0.9 million for the three months ended September 30, 2025. Operating Expenses Items contributing to the quarter-over-quarter increase in operating expenses are listed in the following table: (in millions) Depreciation, amortization and property tax costs (1) $ (7.1) Facilities expenses, maintenance costs and outside services (2.1) FCG transaction and transition-related expenses (2) 0.6 Payroll, benefits and other employee-related expenses 0.9 Other variances 0.1 Quarter-over-quarter increase in operating expenses $ (7.6) (1) Includes the absence of an RSAM adjustment from FCG which represented a $3.2 million benefit in the third quarter of 2024. (2) Transaction and transition-related expenses represent costs incurred attributable to the acquisition and integration of FCG including, but not limited to, transition services, consulting, system integration, rebranding and legal fees. For the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024: Nine Months Ended September 30, 2025 2024 Change (in millions) Revenue $ 497.8 $ 429.7 $ 68.1 Regulated natural gas and electric costs 137.3 105.7 31.6 Adjusted gross margin (1) 360.5 324.0 36.5 Operations & maintenance 115.6 110.1 (5.5) Depreciation, amortization and property taxes (2) 78.3 63.6 (14.7) Other taxes 4.4 4.6 0.2 FCG transaction and transition-related expenses (3) 1.0 3.1 2.1 Total operating expenses 199.3 181.4 (17.9) Operating income $ 161.2 $ 142.6 $ 18.6 (1) Adjusted Gross Margin is a non-GAAP measure utilized by management to review business unit performance. For a more detailed discussion on the differences between Gross Margin (GAAP) and Adjusted Gross Margin, see the Reconciliation of GAAP to Non-GAAP Measures presented above. 50 Table of Contents (2) Includes the absence of an RSAM adjustment from FCG which represented an $8.9 million benefit during the nine months ended September 30, 2024. (3) Transaction and transition-related expenses represent costs incurred attributable to the acquisition and integration of FCG including, but not limited to, transition services, consulting, system integration, rebranding and legal fees. Operating income for the Regulated Energy segment for the nine months ended September 30, 2025 was $161.2 million, an increase of $18.6 million or 13.0 percent, over the same period in 2024. Excluding transaction and transition-related expenses associated with the acquisition and integration of FCG, operating income increased $16.5 million, or 11.3 percent, compared to the same period in 2024. Higher operating income reflects incremental margin from regulatory initiatives and infrastructure programs, pipeline expansion projects, and organic growth in our natural gas distribution businesses. Excluding the transaction and transition-related expenses described above, the increase in total operating expenses of $20.0 million was largely attributable to the absence of an $8.9 million RSAM adjustment from FCG during the prior-year period, higher depreciation attributable to growth projects and expenses associated with facilities, maintenance and outside services and insurance costs. Items contributing to the period-over-period increase in adjusted gross margin are listed in the following table: (in millions) Natural gas transmission service expansions, including interim services $ 11.7 Contributions from regulated infrastructure programs 11.0 Rate changes associated with recent rate case activities (1) 9.2 Natural gas growth including conversions (excluding service expansions) 5.5 Changes in customer consumption 0.9 Adjusted gross margin from off-system natural gas capacity sales (0.7) Other variances (1.1) Period-over-period increase in adjusted gross margin $ 36.5 (1) Includes adjusted gross margin contributions from both interim and permanent base rates. Refer to Major Projects discussion for additional information. The following narrative discussion provides further detail and analysis of the significant items in the table above: Natural Gas Transmission Service Expansions, including interim services We generated increased adjusted gross margin of $11.7 million for the nine months ended September 30, 2025 from natural gas transmission service expansions of Peninsula Pipeline and Eastern Shore. Contributions from Regulated Infrastructure Programs Regulated infrastructure programs generated incremental adjusted gross margin of $11.0 million for the nine months ended September 30, 2025. The increase in adjusted gross margin was primarily related to FCG's SAFE program, Florida's GUARD program, Eastern Shore's Capital Cost Surcharge program, and FPU Electric's SPP. Refer to Note 5, Rates and Other Regulatory Activities , in the condensed consolidated financial statements for additional information. Rate Changes Associated with Recent Rate Case Activities Rate changes associated with the Delaware and Maryland natural gas rate cases and Florida Electric base rate case contributed additional adjusted gross margin of $9.2 million for the nine months ended September 30, 2025. Refer to Note 5, Rates and Other Regulatory Activities , in the condensed consolidated financial statements for additional information. Natural Gas Distribution Customer Growth We generated additional adjusted gross margin of $5.5 million from natural gas customer growth. Adjusted gross margin increased by $4.1 million for our Florida natural gas distribution service territories and $1.4 million on the Delmarva Peninsula for the nine months ended September 30, 2025, as compared to the same period in 2024, due to residential customer growth in Florida and on the Delmarva Peninsula, as well as growth attributable to commercial and industrial customers. Changes in Customer Consumption Customer consumption, inclusive of weather-related consumption, increased adjusted gross margin by $0.9 million for the nine months ended September 30, 2025. Adjusted Gross Margin from Off-system Natural Gas Capacity Sales Fewer off-system natural gas capacity sales reduced adjusted gross margin by $0.7 million for the nine months ended September 30, 2025. 51 Table of Contents Operating Expenses Items contributing to the period-over-period increase in operating expenses are listed in the following table: (in millions) Depreciation, amortization and property tax costs (1) $ (14.7) Facilities expenses, maintenance costs and outside services (4.5) Insurance related costs (1.1) FCG transaction and transition-related expenses (2) 2.1 Other variances 0.3 Period-over-period increase in operating expenses $ (17.9) (1) Includes the absence of an RSAM adjustment from FCG which represented an $8.9 million benefit during the nine months ended September 30, 2024. (2) Transaction and transition-related expenses represent costs incurred attributable to the acquisition and integration of FCG including, but not limited to, transition services, consulting, system integration, rebranding and legal fees. 52 Table of Contents Unregulated Energy Segment For the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024: Three Months Ended September 30, 2025 2024 Change (in millions) Revenue $ 40.7 $ 35.6 $ 5.1 Unregulated propane and natural gas costs 18.3 15.8 2.5 Adjusted gross margin (1) 22.4 19.8 2.6 Operations & maintenance 19.9 17.1 (2.8) Depreciation, amortization and property tax costs 5.8 5.1 (0.7) Other taxes 0.6 0.7 0.1 Total operating expenses 26.3 22.9 (3.4) Operating loss $ (3.9) $ (3.1) $ (0.8) (1) Adjusted Gross Margin is a non-GAAP measure utilized by management to review business unit performance. For a more detailed discussion on the differences between Gross Margin (GAAP) and Adjusted Gross Margin, see the Reconciliation of GAAP to Non-GAAP Measures presented above. Operating results for the Unregulated Energy segment for the third quarter of 2025 reflect a $0.8 million decrease compared to the same period in 2024. The increase in adjusted gross margin in the Unregulated Energy segment during the third quarter of 2025 was primarily driven by increased levels of CNG, RNG and LNG services and increased performance at Aspire Energy, partially offset by reduced margin per gallon and fees in our propane distribution business. Operating expenses increased due to higher payroll, benefits and employee-related expenses as well as increased facilities, maintenance and outside service costs compared to the prior-year period. Higher depreciation, amortization and property tax costs also contributed to the increase in operating expenses during the quarter. Items contributing to the quarter-over-quarter increase in adjusted gross margin are listed in the following table: (in millions) Propane Operations Change in propane margins and service fees $ (0.7) CNG/RNG/LNG Transportation and Infrastructure Increased CNG/RNG/LNG services 3.1 Aspire Energy Increased performance from Aspire Energy 0.4 Other variances (0.2) Quarter-over-quarter increase in adjusted gross margin $ 2.6 The following narrative discussion provides further detail and analysis of the significant items in the table above. Propane Operations • Change in propane margins and service fees - Adjusted g ross margin decreased by $0.7 million during the third quarter of 2025, mainly due to decreased margins and customer service fees. Market conditions, which include market pricing and competition with other propane suppliers, as well as the availability and price of alternative energy sources, may fluctuate based on changes in demand, supply and other energy commodity prices and can impact our margins. CNG/RNG/LNG Transportation and Infrastructure • Increased level of CNG, RNG and LNG services - Adjusted gross margin increased by $3.1 million during the third quarter of 2025 as compared to the same period in the prior year due to higher levels of CNG and RNG hold services and contributions from our Full Circle Dairy RNG facility. Aspire Energy • Increased performance from Aspire Energy - Adjusted gross margin increased by $0.4 million compared to the prior- 53 Table of Contents year period. Operating Expenses Items contributing to the quarter-over-quarter increase in operating expenses are listed in the following table: (in millions) Payroll, benefits and other employee-related expenses $ (1.5) Facilities expenses, maintenance costs and outside services (1.3) Depreciation, amortization and property tax costs (0.7) Other variances 0.1 Quarter-over-quarter increase in operating expenses $ (3.4) For the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024: Nine Months Ended September 30, 2025 2024 Change (in millions) Revenue $ 195.3 $ 160.1 $ 35.2 Unregulated propane and natural gas costs 93.4 70.9 22.5 Adjusted gross margin (1) 101.9 89.2 12.7 Operations & maintenance 62.1 54.5 (7.6) Depreciation, amortization and property tax costs 16.8 14.1 (2.7) Other taxes 2.1 1.9 (0.2) Total operating expenses 81.0 70.5 (10.5) Operating income $ 20.9 $ 18.7 $ 2.2 (1) Adjusted Gross Margin is a non-GAAP measure utilized by management to review business unit performance. For a more detailed discussion on the differences between Gross Margin (GAAP) and Adjusted Gross Margin, see the Reconciliation of GAAP to Non-GAAP Measures presented above. Operating results for the Unregulated Energy segment for the nine months ended September 30, 2025 reflect a $2.2 million increase compared to the same period in 2024. The increase in adjusted gross margin in the Unregulated Energy segment during the first nine months of 2025 was primarily due to increased levels of CNG, RNG and LNG services as well as increased consumption in our propane distribution business and at Aspire Energy. These margin improvements were partially offset by lower margin per gallon and fees in our propane distribution business. The increase in operating expenses included higher payroll, benefits and other employee-related expenses, increased facilities, maintenance and outside service costs, and higher depreciation, amortization and property tax costs compared to the prior-year period. 54 Table of Contents Items contributing to the period-over-period increase in adjusted gross margin are listed in the following table: (in millions) Propane Operations Increased propane customer consumption $ 2.8 Change in propane margins and service fees (1.3) CNG/RNG/LNG Transportation and Infrastructure Increased CNG/RNG/LNG services 10.1 Aspire Energy Increased customer consumption 1.1 Increased performance from Aspire Energy 0.2 Other variances (0.2) Period-over-period increase in adjusted gross margin $ 12.7 The following narrative discussion provides further detail and analysis of the significant items in the table above. Propane Operations • Propane customer consumption - Adjusted gross margin increased by $2.8 million due to increased customer consumption resulting primarily from colder year-over-year weather in our Delmarva service territory. • Change in propane margins and service fees - Adjusted g ross margin decreased by $1.3 million for the nine months ended September 30, 2025, mainly due to decreased margins and customer service fees. Market conditions, which include market pricing and competition with other propane suppliers, as well as the availability and price of alternative energy sources, may fluctuate based on changes in demand, supply and other energy commodity prices and can impact our margins. CNG/RNG/LNG Transportation and Infrastructure • Increased level of CNG, RNG and LNG services - Adjusted gross margin increased by $10.1 million for the nine months ended September 30, 2025 as compared to the same period in the prior year due to higher levels of CNG and RNG hold services and contributions from our Full Circle Dairy RNG facility. Aspire Energy • Increased customer consumption - Adjusted gross margin increased by $1.1 million due to increased customer consumption during the current year primarily related to year-over-year colder weather in our Ohio service area. • Increased performance from Aspire Energy - Adjusted gross margin increased by $0.2 million compared to the prior-year period. Operating Expenses Items contributing to the period-over-period increase in operating expenses are listed in the following table: (in millions) Payroll, benefits and other employee-related expenses $ (3.9) Facilities expenses, maintenance costs and outside services (3.7) Depreciation, amortization and property tax costs (2.7) Other variances (0.2) Period-over-period increase in operating expenses $ (10.5) 55 Table of Contents O THER I NCOME , N ET For the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 Other income, net, which includes non-operating investment income, interest income, late fees charged to customers, gains or losses from the sale of assets and pension and other benefits expense, amounted to $0.2 million in the third quarter of 2025 compared to $0.5 million during the prior-year period. For the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 Other income, net, was $1.2 million for the nine months ended September 30, 2025 compared to $1.7 million during the prior-year period. I NTEREST CHARGES For the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 Interest charges for the three months ended September 30, 2025 increased by $1.1 million compared to the same period in 2024, attributable primarily to the Senior Notes issued in November 2024 and in August and September 2025. Increased interest expense was partially offset by lower average outstanding Revolver borrowings and weighted-average interest rate compared to the prior-year period. The weighted-average interest rate on our Revolver borrowings was 5.0 percent for the three months ended September 30, 2025 compared to 5.8 percent during the prior-year period. For the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 Interest charges for the nine months ended September 30, 2025 increased by $3.2 million compared to the same period in 2024, attributable primarily to the Senior Notes issued in November 2024 and in August and September 2025. Increased interest expense was partially offset by lower average outstanding Revolver borrowings and weighted-average interest rate compared to the prior-year period. The weighted-average interest rate on our Revolver borrowings was 5.1 percent for the nine months ended September 30, 2025 compared to 5.8 percent during the prior-year period. INCOME TAXES For the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024 Income tax expense was $7.6 million and $6.8 million for the quarters ended September 30, 2025 and September 30, 2024, respectively, resulting in an effective income tax rate of 28.1 percent and 27.9 percent, respectively, during the periods then ended. For the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 Income tax expense was $35.0 million and $30.2 million for the nine months ended September 30, 2025 and September 30, 2024, respectively, resulting in an effective income tax rate of 27.1 percent and 26.9 percent, respectively, during the periods then ended. F INANCIAL P OSITION , L IQUIDITY AND C APITAL R ESOURCES Our capital requirements reflect the capital-intensive and seasonal nature of our business and are principally attributable to investment in new plant and equipment, retirement of outstanding debt and seasonal variability in working capital. We rely on cash generated from operations, short-term borrowings, and other sources to meet normal working capital requirements and to temporarily finance capital expenditures, which we believe will provide sufficient liquidity to fund our current obligations, debt service requirements and capital expenditures over the next twelve months. We may also issue long-term debt and equity to fund capital expenditures and to maintain our capital structure within our target capital structure range. We maintain effective shelf registration statements with the SEC for the issuance of common stock in various types of equity offerings, including pursuant to our DRIP and ATM program. Depending on our capital needs and subject to market conditions, we may issue additional shares under the DRIP in addition to other possible debt and equity offerings. Our energy businesses are weather-sensitive and seasonal. We normally generate a large portion of our annual net income and subsequent increases in our accounts receivable in the first and fourth quarters of each year due to significant volumes of natural gas, electricity, and propane delivered by our distribution operations, and our natural gas transmission operations to customers during the peak-heating season. In addition, our natural gas and propane inventories, which usually peak in the fall months, are largely drawn down in the heating season and provide a source of cash as the inventory is used to satisfy winter sales demand. Capital expenditures for investments in new or acquired plant and equipment are our largest capital requirements. Our capital expenditures were $335.6 million for the nine months ended September 30, 2025. 56 Table of Contents In the table below, we have provided the range of our forecasted capital expenditures for 2025: 2025 (in millions) Low High Regulated Energy: Natural gas distribution $ 170.0 $ 175.0 Natural gas transmission 170.0 175.0 Electric distribution 35.0 40.0 Total Regulated Energy 375.0 390.0 Unregulated Energy: Propane distribution 12.0 15.0 Energy transmission 8.0 10.0 Other unregulated energy 12.0 15.0 Total Unregulated Energy 32.0 40.0 Other: Corporate and other businesses 18.0 20.0 Total 2025 Forecasted Capital Expenditures $ 425.0 $ 450.0 The capital expenditure projection is subject to continuous review and modification. Actual capital requirements may vary from the above estimates due to a number of factors, including changing political and economic conditions, supply chain disruptions, capital delays that are greater than currently anticipated, customer growth in existing areas, regulation, new growth or acquisition opportunities and availability of capital and other factors discussed in Item 1A., Risk Factors, in our 2024 Annual Report on Form 10-K. At September 30, 2025, the Company further increased and refined its 2025 capital guidance range to $425.0 million to $450.0 million given progress on its capital projects. The timing of capital expenditures can vary based on delays in regulatory approvals, securing environmental approvals and other permits. The regulatory application and approval process has lengthened in the past few years, and we expect this trend to continue. Capital Structure We are committed to maintaining a sound capital structure and strong credit ratings. This commitment, along with adequate and timely rate relief for our regulated energy operations, is intended to ensure our ability to attract capital from outside sources at a reasonable cost, which will benefit our customers, creditors, employees and stockholders. The following table presents our capitalization, excluding and including short-term borrowings, as of September 30, 2025 and December 31, 2024: September 30, 2025 December 31, 2024 (in millions) Long-term debt, net of current maturities $ 1,437.9 49 % $ 1,261.7 48 % Stockholders’ equity 1,518.7 51 % 1,390.2 52 % Total capitalization, excluding short-term debt $ 2,956.6 100 % $ 2,651.9 100 % September 30, 2025 December 31, 2024 (in millions) Short-term debt $ 95.8 3 % $ 196.5 7 % Long-term debt, including current maturities 1,472.4 48 % 1,287.2 45 % Stockholders’ equity 1,518.7 49 % 1,390.2 48 % Total capitalization, including short-term debt $ 3,086.9 100 % $ 2,873.9 100 % Our target ratio of equity to total capitalization, including short-term borrowings, is between 50 and 60 percent. Our equity to total capitalization ratio, including short-term borrowings, was 49 percent as of September 30, 2025, as the Company continues to remain focused on moving back closer to this target ratio. In the last twelve months, the Company has issued $92.0 million of new equity via the DRIP and ATM program, representing 729 thousand incremental shares. 57 Table of Contents We seek to align permanent financing with the in-service dates of our capital projects. We may utilize more temporary short-term debt when the financing cost is attractive as a bridge to the permanent long-term financing or if the equity markets are volatile. In November 2024, we established a new ATM program under which we may sell shares of our common stock up to an aggregate offering price of $100.0 million. This current ATM program is active through November 2027. For the nine months ended September 30, 2025 and 2024, we received net proceeds of $76.3 million and $56.8 million, respectively, associated with shares issued under the DRIP as well as shares issued under our ATM program. Shelf Agreements We have entered into Shelf Agreements with Prudential and MetLife with terms that extend through February 2026 and June 2030, respectively, however neither of such lenders have any obligation to purchase debt thereunder. In June 2025, we amended our Shelf Agreement with MetLife to expand the total borrowing capacity and extend the term of the agreement for an additional five years. At September 30, 2025, a total of $305.0 million of borrowing capacity was available under these Shelf Agreements. All of our outstanding Senior Notes set forth certain business covenants to which we are subject when any note is outstanding, including covenants that limit or restrict our ability, and the ability of our subsidiaries, to incur indebtedness, or place or permit liens and encumbrances on any of our property or the property of our subsidiaries. Short-term Borrowings As of September 30, 2025, we are authorized by our BOD to borrow up to $450.0 million of short-term debt, as required. At September 30, 2025 and December 31, 2024, we had $95.8 million and $196.5 million, respectively, of short-term borrowings outstanding at a weighted average interest rate of 4.96 percent and 5.06 percent, respectively. There were no borrowings outstanding under the sustainable investment sublimit of the 364-day tranche at September 30, 2025. In August 2024, we amended and restated our revolving credit agreement, which increased the total borrowing capacity under the Revolver to $450.0 million, including $250.0 million available under the 364-day tranche and $200.0 million available under the five-year tranche which expires in August 2029. In August 2025, we exercised an option under the Revolver to extend the 364-day tranche through August 2026. All other terms and conditions of the agreement remain unchanged. We may also request increases under the Revolver of up to $50.0 million under the 364-day tranche and up to $100.0 million under the five-year tranche, with the lenders having sole discretion of whether to approve each requested increase. Borrowings under both tranches of the Revolver continue to be subject to a pricing grid, including the commitment fee and the interest rate charged based upon our total indebtedness to total capitalization ratio for the prior quarter. The 364-day tranche continues to bear interest (i) based upon the SOFR, plus a 10-basis point credit spread adjustment, and an applicable margin of 1.05 percent or less, with such margin based on total indebtedness as a percentage of total capitalization or (ii) the base rate, solely at our discretion. The five-year tranche continues to bear interest (i) based upon the SOFR, plus a 10-basis point credit spread adjustment, and an applicable margin of 1.25 percent or less, with such margin based on total indebtedness as a percentage of total capitalization or (ii) the base rate, solely at our discretion. We also utilize interest rate swaps to manage rate risk under our Revolver. For additional information on interest rate swaps, including swaps currently in place related to our short-term borrowings, see Note 12, Derivative Instruments . The availability of funds under the Revolver is subject to conditions specified in the credit agreement, all of which we currently satisfy. These conditions include our compliance with financial covenants and the continued accuracy of representations and warranties contained in the Revolver's loan documents. We are required by the financial covenants in the Revolver to maintain, at the end of each fiscal year, a funded indebtedness ratio of no greater than 65 percent. As of September 30, 2025, we were in compliance with this covenant. Our total available credit under the Revolver at September 30, 2025 was $349.9 million . As of September 30, 2025, we had issued $4.3 million in letters of credit to various counterparties under the Revolver. These letters of credit are not included in the outstanding short-term borrowings and we do not anticipate that they will be drawn upon by the counterparties. The letters of credit reduce the available borrowings under the Revolver. 58 Table of Contents Long-Term Debt In August 2025, we entered into a Note Purchase Agreement for the issuance of Senior Notes in the aggregate principal amount of $200.0 million with an initial funding of $150.0 million in August 2025 and an additional $50.0 million in September 2025. These Senior Notes have an average interest rate of 5.04 percent consisting of $60.0 million of 4.88 percent notes due in August 2028, $50.0 million of 5.02 percent notes due in September 2030, and $90.0 million of 5.16 percent notes due in August 2031. The proceeds received were used to reduce short-term borrowings under our Revolver and to fund capital expenditures. The outstanding principal balance of the Senior Notes will be due on their respective maturity dates with interest payments payable semiannually beginning in 2026 until the principal has been paid in full. These Senior Notes have similar covenants and default provisions as our other Senior Notes. On November 1, 2024, we issued 5.20 percent Senior Notes due in November 2029 in the aggregate principal amount of $100.0 million. The proceeds received were used to reduce short-term borrowings under our Revolver and to fund capital expenditures. These Senior Notes have similar covenants and default provisions as our other Senior Notes and have semi-annual interest payments due on May 1 and November 1 of each year which began in 2025. Cash Flows The following table provides a summary of our operating, investing and financing cash flows for the nine months ended September 30, 2025 and 2024: Nine Months Ended September 30, (in millions) 2025 2024 Net cash provided by (used in): Operating activities $ 198.3 $ 217.7 Investing activities (318.2) (256.0) Financing activities 113.8 35.0 Net decrease in cash and cash equivalents (6.1) (3.3) Cash and cash equivalents—beginning of period 7.9 4.9 Cash and cash equivalents—end of period $ 1.8 $ 1.6 Cash Flows Provided by Operating Activities Changes in our cash flows from operating activities are attributable primarily to changes in net income, adjusted for non-cash items such as depreciation and amortization, changes in deferred income taxes, share-based compensation expense and working capital. Working capital requirements are determined by a variety of factors, including weather, the prices of natural gas, electricity and propane, the timing of customer collections, payments for purchases of natural gas, electricity and propane, and deferred fuel cost recoveries. During the nine months ended September 30, 2025, net cash provided by operating activities was $198.3 million. Operating cash flows were primarily impacted by the following: • Net income, adjusted for non-cash adjustments, provided a $175.6 million source of cash; • An increased level of deferred taxes associated largely with incremental tax depreciation from growth investments resulted in a source of cash of $43.3 million; • Changes in net regulatory assets and liabilities due primarily to the change in fuel costs collected through the various cost recovery mechanisms resulted in a $17.0 million use of cash; and • Other working capital changes resulted in a $3.5 million use of cash. Cash Flows Used in Investing Activities Net cash used in investing activities totaled $318.2 million during the nine months ended September 30, 2025, attributable to $322.2 million related to new capital expenditures partially offset by proceeds from asset sales of $4.0 million. Cash Flows Provided by Financing Activities Net cash provided by financing activities totaled $113.8 million during the nine months ended September 30, 2025 and was largely impacted by the following: 59 Table of Contents • Net proceeds of $184.6 million from long-term debt issuances and repayments; • Net proceeds of $76.1 million from the issuance of stock; • Net repayments under the Revolver of $103.5 million; and • A $44.8 million use of cash for dividend payments in 2025. Off-Balance Sheet Arrangements Our BOD has authorized us to issue corporate guarantees securing obligations of our subsidiaries and to obtain letters of credit securing our subsidiaries' obligations. The maximum authorized liability under such guarantees and letters of credit as of September 30, 2025 was $40.0 million . The aggregate amount guaranteed related to our subsidiaries at September 30, 2025 was $30.4 million, with the guarantees expiring on various dates through September 30, 2026. In addition, the BOD authorized us to issue specific purpose corporate guarantees. The amount of specific purpose guarantees outstanding at September 30, 2025 was $4.0 million. As of September 30, 2025, we have issued letters of credit totaling $4.3 million related to various transportation, transmission, capacity and storage agreements as well as our primary insurance carriers. These letters of credit have various expiration dates throu gh April 2026 and to date, none have been used. We do not anticipate that the counterparties will draw upon these letters of credit and we expect that they will be renewed to the extent necessary in the future. Additional information is presented in Note 7 , Other Commitments and Contingencies, in the condensed consolidated financial statements. Contractual Obligations There has been no material change in the contractual obligations presented in our 2024 Annual Report on Form 10-K. Rates and Regulatory Matters Our natural gas distribution operations in Delaware, Maryland and Florida and electric distribution operation in Florida are subject to regulation by the respective state PSC; Eastern Shore is subject to regulation by the FERC; and Peninsula Pipeline and Aspire Energy Express, our intrastate pipeline subsidiaries, are subject to regulation (excluding cost of service) by the Florida PSC and Public Utilities Commission of Ohio, respectively. We regularly are involved in regulatory matters in each of the jurisdictions in which we operate. Our significant regulatory matters are fully described in Note 5 , Rates and Other Regulatory Activities , to the condensed consolidated financial statements in this Quarterly Report on Form 10-Q. Recent Authoritative Pronouncements on Financial Reporting and Accounting Recent accounting developments, applicable to us, and their expected impact on our financial position, results of operations and cash flows, are described in Note 1 , Summary of Accounting Policies , to the condensed consolidated financial statements in this Quarterly Report on Form 10-Q. Recent International Trade Developments Recently, significant trade tariffs were enacted and proposed to be enacted through presidential executive orders affecting products exported by a number of U.S. trading partners. While some tariffs scheduled to take effect were temporarily suspended, broad tariffs remain in effect with the possibility of additional tariffs being imposed. Trade tariffs are likely to increase the cost of imported materials and equipment, disrupt supply chains, drive economic volatility, and create adverse capital and credit market conditions. For example, the cost of pipes, meters, transformers, and specialized equipment we use in our capital projects may materially increase thus increasing our overall investment in and cost of these projects. We are currently unable to predict the effects of the recently imposed and possible future tariffs on our business. Additionally, the current presidential administration has directed various federal agencies to further evaluate key aspects of U.S. trade policy and there has been ongoing discussion, commentary and actions regarding potential significant changes to U.S. trade policies, treaties and tariffs. In 2025, the President indicated that the United States would impose retaliatory measures with respect to jurisdictions that have or are likely to put in place tax rules that are extraterritorial or disproportionately affect U.S. companies. The likelihood of these changes being enacted or implemented is unclear. We are currently unable to predict whether such changes will occur and, if so, their ultimate impact on our businesses. We are also unable to reasonably estimate the effects of the rapidly evolving trade tariff landscape, which could include project delays, cost increases, and obstacles to the Company’s strategic plan execution. We are closely monitoring the impacts of trade tariffs and the potential effect they may have on the Company’s financial position, results of operations, or cash flows. 60 Table of Contents