What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2026-05-06 compared with 2025-11-06 · 200 added, 483 removed, 476 unchanged (59% of the section changed)

10 unchanged sentences

• 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 outcomes of regulatory, environmental and legal matters, including whether pending matters are resolved within current estimates and within expected times, 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 impact of significant changes to tax regulations and rates;

• 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;

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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.

Within our 2025 Annual Report to Shareholders, we continued to highlight our ongoing efforts related to these commitments.

We encourage our investors to review the 2025 Annual Report to Shareholders, as well as our prior micro and consolidated sustainability reports, which can be accessed on our website.

Non-GAAP Financial Measures

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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

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

For the Three Months Ended March 31, 2026

(in millions) Regulated Energy Unregulated Energy Other Businesses and Eliminations Total

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Adjusted Gross Margin (Non-GAAP) $ 147.7 $ 58.6 $ (0.1) $ 206.2

For the Nine Months Ended September 30, 2024

For the Three Months Ended March 31, 2025

(in millions) Regulated Energy Unregulated Energy Other Businesses and Eliminations Total

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2026 to 2025 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.

Gross Margin (GAAP) for the Regulated Energy segment for the three months ended March 31, 2026 was $114.9 million, an increase of $17.7 million, or 18.2 percent, compared to the same period in 2025.

2026 to 2025 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.

Gross Margin (GAAP) for the Unregulated Energy segment for the three months ended March 31, 2026 was $42.3 million, an increase of $2.4 million, or 6.0 percent, compared to the same period in 2025.

The increase in gross margin was primarily attributable to higher results from our propane distribution business largely attributable to increased customer consumption from colder year-over-year weather in our Delmarva service areas, and increased performance from Aspire Energy.

Adjusted Net Income and Adjusted EPS

Three Months Ended Nine Months Ended

September 30, September 30,

Three Months Ended

(dollars in millions, shares in thousands (except per share data)) 2026 2025

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FCG transaction and transition-related expenses, net (1)

0.1 0.6 0.7 2.3

Adjusted Net Income (Non-GAAP) $ 59.3 $ 51.1

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FCG transaction and transition-related expenses, net (1)

— 0.02 0.03 0.10

Adjusted Earnings Per Share - Diluted (Non-GAAP) $ 2.47 $ 2.22

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2026 to 2025 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.

Net income (GAAP) for the three months ended March 31, 2026 was $59.3 million, or $ 2.47 per share, compared to $50.9 million, or $2.21 per share, for the same quarter of 2025.

Net income for the three months ended March 31, 2025 included $0.2 million of transaction and transition-related expenses in connection with the acquisition and integration of FCG.

Excluding these costs, net income increased by $8.2 million or 16.0 percent compared to the prior-year period.

Results of Operations for the Three and Nine Months Ended September 30, 2025

Results of Operations for the Three Months Ended March 31, 2026

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.

Our adjusted net income for the three months ended March 31, 2026 was $59.3 million, or $2.47 per share, compared to $51.1 million, or $2.22 per share, for the same period in 2025.

Operating income for the first three months of 2026 was $99.4 million, an increase of $12.6 million compared to the same period in 2025.

Excluding transaction and transition-related expenses associated with the acquisition and integration of FCG, operating income increased $12.3 million or 14.1 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.

The increase in adjusted gross margin in the first quarter of 2026 was primarily driven by incremental margin from regulatory initiatives and infrastructure programs, pipeline expansion projects and natural gas organic growth, increased customer consumption resulting from year-over-year colder temperatures largely in the Company's Delmarva service areas, and improved performance at Aspire Energy.

Higher operating expenses were driven largely by increased payroll, benefits and other employee-related expenses and higher facilities, maintenance costs and outside services compared to the prior-year period.

Depreciation and amortization expense for the current period includes decreases related to certain regulatory items including the absence of recovered costs associated with Hurricane Michael and the impact of the FCG depreciation study.

These amounts were largely offset by additional depreciation, amortization and property taxes associated with growth.

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.

Key variances between the third quarter of 2024 and 2025 included:

(in millions, except per share data) Pre-tax

Income Earnings

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)

Contributions from regulated infrastructure programs (2)

Rate changes associated with recent rate case activities (2)

Increased CNG/RNG/LNG services (2)

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)

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.

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.

Nine Months Ended

September 30, Increase

March 31, Increase

2026 2025 (Decrease)

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FCG transaction and transition-related expenses, net (1)

0.7 2.3 (1.6)

Adjusted Net Income (Non-GAAP) $ 59.3 $ 51.1 $ 8.2

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Key variances between the nine months ended September 30, 2024 and September 30, 2025 included:

Key variances between the three months ended March 31, 2025 and March 31, 2026 included:

(in millions, except per share data) Pre-tax

Income Earnings

Nine months ended September 30, 2024 Adjusted Results (1)

Three Months Ended March 31, 2025 Adjusted Results (1)

$ 69.7 $ 51.1 $ 2.22

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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

Changes in customer consumption 4.5 3.3 0.14

Rate changes associated with recent rate case activities (2)

Natural gas growth including conversions (excluding service expansions) 2.0 1.5 0.06

Changes in customer consumption 4.8 3.5 0.15

Increased Aspire Energy performance - rate changes and gathering fees 1.4 1.0 0.04

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)

Change in off-system natural gas capacity sales 1.1 0.8 0.03

Absence of recovered costs associated with Hurricane Michael (3)

(2.0) (1.5) (0.06)

23.5 17.2 0.72

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 (6.6) (4.9) (0.20)

Insurance related costs (0.7) (0.5) (0.02)

Facilities expenses, maintenance costs and outside services (3.1) (2.2) (0.09)

Depreciation, amortization and property taxes (1.5) (1.1) (0.05)

Credit, collections and customer service costs (1.4) (1.1) (0.04)

Absence of amortization of costs associated with Hurricane Michael recovery (3)

(10.6) (7.8) (0.32)

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(1.9) (1.2) (0.15)

Nine months ended September 30, 2025 Adjusted Results (1)

Three Months Ended March 31, 2026 Adjusted Results (1)

$ 80.7 $ 59.3 $ 2.47

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(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.

(3) The current period includes offsetting reductions in both adjusted gross margin and depreciation and amortization expense related to the absence of

recovered costs associated with Hurricane Michael.

(4) Reflects the impact of approximately 0.8 million common shares issued under the DRIP/DSSP and ATM program.

Summary of Key Factors

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Adjusted Gross Margin

Three Months Ended Nine Months Ended Year Ended Estimate for

September 30, September 30, December 31, Fiscal

Three Months Ended Year Ended Estimate for

March 31, December 31, Fiscal

(in millions) 2026 2025 2025 2026 2027

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Wildlight 1.1 0.5 2.6 4.3 4.3

Newberry 0.6 0.6 1.8 0.7 1.4 2.6 2.6

Worcester Resiliency Upgrade 0.4 — 0.3 1.5 17.1

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Central Florida Reinforcement 1.1 0.3 2.6 4.3 4.3

Warwick 0.5 — 1.5 — 0.4 1.9 1.9

Renewable Natural Gas Supply Projects 1.3 — 2.5 5.4 6.4

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Total Pipeline Expansions 8.3 1.4 18.3 32.9 50.6

CNG/RNG/LNG Transportation and Infrastructure 6.6 3.5 20.5 10.4 16.4 25.5 26.5

Regulatory Initiatives:

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Electric Storm Protection Plan 3.3 1.1 6.4 10.7 11.0

Florida Mandatory Relocates 0.5 — — 1.5 1.5

Maryland Rate Case (1)

1.3 — 1.5 3.5 3.5

Delaware Rate Case (1)

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2.2 0.7 7.3 8.6 9.1

Florida City Gas Rate Case — — — TBD TBD

Total Regulatory Initiatives 16.9 7.3 41.1 62.2 70.7

Total $ 25.2 $ 8.7 $ 59.4 $ 95.1 $ 121.3

(1) Includes adjusted gross margin attributable to interim rates during 2024 and 2025.

(1) Includes adjusted gross margin attributable to interim and permanent rates.

See additional information provided below.

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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

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 2026 and annually thereafter.

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Cloud, Florida area.

The project is driven by the need to expand gas service to future communities that are expected in that area.

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.

The Florida PSC approved the project in May 2024, and it is expected to be complete in the second quarter of 2026.

For the three months ended March 31, 2026, these projects generated incremental adjusted gross margin of $0.9 million.

We expect this expansion to generate approximately $3.2 million in 2026 and 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.

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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.

The petition was approved by the Florida PSC in November 2022.

The various phases of the project commenced in the first quarter of 2023, and construction was completed in 2025.

The project generated incremental adjusted gross margin of $0.6 million for the three months ended March 31, 2026, and is expected to contribute adjusted gross margin of approximately $4.3 million in 2026 and annually thereafter.

Worcester Resiliency Upgrade

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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.

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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.

Construction commenced shortly after approval and is well underway.

The weather during the first quarter resulted in several brief slowdowns which had a cumulative impact on the overall timeline.

Project construction and commissioning are expected to be complete in the latter part of the year with the FERC approval process to immediately follow.

The Company expects to receive full approval for in-service of the facility by the beginning of 2027.

The project generated adjusted gross margin of $0.4 million for the three months ended March 31, 2026.

The project is expected to contribute adjusted gross margin of approximately $1.5 million in 2026 and $17.1 million in 2027 and annually 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.

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 support additional supply to communities on the East Coast of Florida.

The projects are driven by the need for increased supply to coastal portions of the state that have experienced an increase in population growth.

Peninsula Pipeline will construct several pipeline extensions which will 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.

New Smyrna Beach was placed into service during May 2025 and construction is projected to be complete for Boynton Beach in the second quarter of 2026.

The projects generated incremental adjusted gross margin of $1.0 million for the three months ended March 31, 2026, and are expected to contribute adjusted gross margin of approximately $6.0 million in 2026 and annually thereafter.

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 projects are driven by the need for increased supply to communities in central Florida that are experiencing significant population growth.

Peninsula Pipeline's extensions support FPU’s distribution system around the Plant City and Lake Mattie area's of Florida with an additional 5,000 Dts/d and 8,700 Dts/d, respectively.

The Florida PSC approved the projects in March 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.

The projects generated incremental adjusted gross margin of $0.8 million for the three months ended March 31, 2026, and both projects are expected to contribute total adjusted gross margin of approximately $4.3 million in 2026 and annually thereafter.

Renewable Natural Gas Supply Projects

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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.

The Florida PSC approved the petition at its July 2024 meeting.

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.

The projects are underway and are estimated to be completed in the second half of 2026.

These three renewable projects generated adjusted gross margin of $1.3 million for the three months ended March 31, 2026, and are projected to generate total adjusted gross margin of approximately $5.4 million in 2026 and $6.4 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 proposed expansion consists of the development of several pipeline projects to support growth and FCG's distribution system, 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.

The project generated adjusted gross margin of $1.9 million for the three months ended March 31, 2026 and is expected to contribute adjusted gross margin of approximately $7.6 million in 2026 and annually thereafter.

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.

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

This new transmission infrastructure is expected to be in service in the first half of 2027 and is expected to contribute adjusted gross margin of approximately $1.1 million in 2027 and approximately $2.1 million annually thereafter.

Regulatory Initiatives (with recent regulatory actions)

Florida GUARD Program

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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.

For t he three months ended March 31, 2026 , there was $0.9 million of incremental adjusted gross margin generated pursuant to the program.

The program is expected to generate $10.1 million of adjusted gross margin in 2026 and $13.0 million in 2027.

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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.

For t he three months ended March 31, 2026 , there was $1.1 million of incremental adjusted gross margin generated pursuant to the program.

The program is expected to generate $12.7 million of adjusted gross margin in 2026 and $16.4 million in 2027.

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.

Specifically, the requested modifications enable FCG to accelerate remediation related to problematic pipe and facilities consisting of obsolete and exposed pipe.

These modifications will improve the safety and reliability of service to FCG's customers and result in an estimated additional $50.0 million in capital expenditures associated with the SAFE Program, increasing the total projected capital expenditures to approximately $255.0 million over a 10-year period.

The Florida PSC approved the modifications in September 2024.

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In March 2026, 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 capital cost surcharge mechanism was approved in Eastern Shore's last rate case.

There was a slight decrease to the revenue requirement of the currently effective surcharge as a result of the true-up.

The FERC issued an order approving the surcharge as filed effective April 1, 2026.

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.

For t he three months ended March 31, 2026 , there was $0.8 million of incremental adjusted gross margin generated pursuant to the program.

Eastern Shore expects to generate adjusted gross margin of approximately $9.0 million in 2026 and $10.1 million in 2027 from relocation projects, which is ultimately dependent upon the timing of filings and the completion of construction.

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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.

Our Florida electric distribution operation's SPP and SPPCRC were filed and approved in 2022, with modifications, by the Florida PSC.

Rates associated with this initiative were effective in January 2023.

In October 2024, the Florida PSC approved the Company's projected 2025 SPP costs of $20.4 million for both capital and operating expenses.

Our Florida electric distribution operations filed an updated SPP plan in January 2025 which was approved in June 2025, with modifications by the Florida PSC.

For the three months ended March 31, 2026, this initiative generated additional adjusted gross margin of $2.2 million and is expected to generate $10.7 million of adjusted gross margin in 2026 and $11.0 million in 2027.

We expect continued investment under the SPP going forward.

Florida Mandatory Relocates

In October 2025, FPU and FCG filed a joint petition for approval to establish a recovery surcharge for actual, estimated and projected relocation costs pursuant to the Florida Administrative Code which enables companies to recover the costs associated with relocating or reconstructing facilities that have been required by governmental entities.

The Florida PSC approved the petition in February 2026, with the surcharge effective in March 2026.

For the three months ended March 31, 2026, there was $0.5 million of adjusted gross margin generated.

The projected total revenue for both 2026 and 2027 is $0.5 million for FPU and $1.0 million for FCG.

Maryland Natural Gas Rate Case

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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.

In September 2024, the Maryland Public Utility Judge approved a $2.6 million increase in annual base rates, which was followed by the Company submitting 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.

In March 2025 the 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.

For the three months ended March 31, 2026, there was $1.3 million of incremental adjusted gross margin generated and the proceeding is expected to result in additional adjusted gross margin of approximately $3.5 million in 2026 and 2027.

Delaware Natural Gas Rate Case

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(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.

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

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.

A settlement among all interested parties 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 and approved tariff-related changes including rate design were effective as of October 15, 2025.

For the three months ended March 31, 2026, there was $1.3 million of incremental adjusted gross margin generated and final rates are expected to generate approximately $6.1 million of adjusted gross margin in 2026 and 2027.

FPU Electric Rate Case

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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.

In May 2025, the Company reached a settlement agreement with the interested parties.

This settlement which was approved by the Florida PSC in July 2025, provides for a total base rate 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 to be completed in December 2026.

For the three months ended March 31, 2026, there was $1.5 million of incremental adjusted gross margin generated and final rates are expected to generate approximately $8.6 million of adjusted gross margin in 2026 and $9.1 million in 2027.

FCG Rate Case

In April 2026, Florida City Gas filed a petition with the Florida PSC.

In connection with the application, we are seeking approval of the following:

(i) interim rate relief of approximately $16.2 million, subject to refund, pending the outcome of the rate case proceeding;

(ii) general base rate increase of $46.9 million with a ROE of 11.25 percent based on a 2027 projected test year;

(iii) reclassification of approximately $16.4 million in the existing SAFE program revenues from surcharge recovery to base rates;

(iv) authorization to retain the unamortized portion of the previously approved acquisition adjustment;

and (v) further implementation of the advanced metering infrastructure (“AMI”).

The outcome of the application will be subject to review and approval by the Florida PSC.

FCG Depreciation Study

In February 2025, FCG filed a depreciation study with the Florida PSC.

The application requested approval of revised annual depreciation rates, as well as a reduction related to a reserve imbalance that would be amortized over a two-year period.

In February 2026, the Florida PSC approved a $6.8 million reserve imbalance to be amortized over the remaining life of the assets.

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.

Three Months Ended Nine Months Ended

September 30, September 30,

2025 2024 Variance 2025 2024 Variance

For the three months ended March 31, 2026, increased customer consumption, which includes the effects of colder weather conditions, largely in our Delmarva service areas, compared to the prior-year period resulted in a $4.5 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 months ended March 31, 2026 and 2025.

Three Months Ended

2026 2025 Variance

Delmarva Peninsula

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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 average number of residential customers served on the Delmarva Peninsula, by FPU and by FCG increased by approximately 3.3 percent, 2.2 percent, and 2.0 percent, respectively, for the three months ended March 31, 2026.

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

Three Months Ended

March 31, 2026

(in millions) Delmarva Peninsula Florida

Customer Growth:

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Regulated Energy Segment

For the quarter ended September 30, 2025 compared to the quarter ended September 30, 2024:

For the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025:

Three Months Ended

September 30,

2026 2025 Change

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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.

(2) The current period includes offsetting reductions in both adjusted gross margin and depreciation and amortization expense related to the absence of recovered costs associated with Hurricane Michael.

See Key variances table above for additional information.

(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.

Operating income for the Regulated Energy segment for the first quarter of 2026 was $71.1 million, an increase of $10.6 million, over the same period in 2025.

Excluding transaction and transition-related expenses associated with the acquisition and integration of FCG, operating income increased $10.3 million, or 16.9 percent, compared to the same period in 2025.

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.

Excluding the transaction and transition-related expenses described above, the increase in total operating expenses of $9.3 million was largely attributable to higher expenses associated with payroll, benefits and other employee related expenses, higher facilities, maintenance costs and outside services, and increased costs related to credit, collections and customer service.

These amounts were largely offset by additional depreciation, amortization and property taxes associated with growth.

Items contributing to the quarter-over-quarter increase in adjusted gross margin are listed in the following table:

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Changes in customer consumption 1.7

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.

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)

Facilities expenses, maintenance costs and outside services (2.1)

FCG transaction and transition-related expenses (2)

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)

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.

(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.

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.

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)

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 1.1

Absence of recovered costs associated with Hurricane Michael (2)

Other variances 0.3

Period-over-period increase in adjusted gross margin $ 36.5

(1) Includes adjusted gross margin contributions from both interim and permanent base rates.

Quarter-over-quarter increase in adjusted gross margin $ 19.6

(1) Includes adjusted gross margin contributions from 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.

We generated increased adjusted gross margin of $6.9 million for the three months ended March 31, 2026 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.

Regulated infrastructure programs generated incremental adjusted gross margin of $5.5 million for the three months ended March 31, 2026.

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.

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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.

Rate changes associated with the Delaware and Maryland natural gas rate cases and Florida Electric base rate case contributed additional adjusted gross margin of $4.1 million for the three months ended March 31, 2026.

Refer to Note 5, Rates and Other Regulatory Activities , in the condensed consolidated financial statements for additional information.

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We generated additional adjusted gross margin of $2.0 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.

Adjusted gross margin increased by $1.5 million for our Florida natural gas distribution service territories and $0.5 million on the Delmarva Peninsula for the three months ended March 31, 2026, as compared to the same period in 2025, due to residential customer growth in these service areas, 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.

Customer consumption, inclusive of weather-related consumption, increased adjusted gross margin by $1.7 million for the three months ended March 31, 2026.

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.

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)

Facilities expenses, maintenance costs and outside services (4.5)

Insurance related costs (1.1)

FCG transaction and transition-related expenses (2)

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.

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-

Off-system natural gas capacity sales increased adjusted gross margin by $1.1 million for the three months ended March 31, 2026.

Absence of Recovered Costs Associated with Hurricane Michael

There is no impact to earnings as this $2.0 million decrease in adjusted gross margin for the three months ended March 31, 2026, is offset by a corresponding decrease in depreciation and amortization expense for the period.

Operating Expenses

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Facilities expenses, maintenance costs and outside services (2.7)

Credit, collections and customer service costs (1.4)

Depreciation, amortization and property tax costs (1.1)

Absence of amortization of costs associated with Hurricane Michael recovery (1)

Other variances (0.8)

Quarter-over-quarter increase in operating expenses $ (9.0)

For the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024:

Nine Months Ended

September 30,

(1) The current period includes offsetting reductions in both adjusted gross margin and depreciation and amortization expense related to the absence of recovered costs associated with Hurricane Michael.

Unregulated Energy Segment

For the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025:

Three Months Ended

2026 2025 Change

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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.

Operating results for the Unregulated Energy segment for the three months ended March 31, 2026 reflect a $2.0 million increase compared to the same period in 2025.

The increase in adjusted gross margin in the Unregulated Energy segment during the first quarter of 2026 was primarily due to increased consumption in our propane distribution business which was impacted by colder weather in the Delmarva service areas as well as improved performance from Aspire Energy.

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.

Items contributing to the period-over-period increase in adjusted gross margin are listed in the following table:

Items contributing to the quarter-over-quarter increase in adjusted gross margin are listed in the following table:

(in millions)

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Increased propane customer consumption $ 2.4

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 performance from Aspire Energy - rate changes and gathering fees 1.4

Increased customer consumption 0.4

Increased performance from Aspire Energy 0.2

Other variances (0.1)

Period-over-period increase in adjusted gross margin $ 12.7

Quarter-over-quarter increase in adjusted gross margin $ 4.1

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.

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.

• Propane customer consumption - Adjusted gross margin increased by $2.4 million due to increased customer consumption resulting primarily from colder year-over-year weather in our Delmarva service areas.

Aspire Energy

• Increased performance from Aspire Energy - Adjusted gross margin increased by $1.4 million compared to the prior-year period due to negotiated rate changes and increased gathering fees.

• Increased customer consumption - Adjusted gross margin increased by $0.4 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:

Items contributing to the quarter-over-quarter increase in operating expenses are listed in the following table:

(in millions)

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Facilities expenses, maintenance costs and outside services (0.4)

Depreciation, amortization and property tax costs (2.7)

Other variances (0.1)

Period-over-period increase in operating expenses $ (10.5)

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.

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.

Quarter-over-quarter increase in operating expenses $ (2.1)

OTHER INCOME, NET

For the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025

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, was not material in the first quarter of 2026 compared to $0.6 million during the prior-year period.

INTEREST CHARGES

For the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025

Interest charges for the quarter ended March 31, 2026 increased by $0.6 million compared to the same period in 2025, attributable primarily to the Senior Notes issued in August and September 2025.

Interest expense on Revolver borrowings slightly offset the interest charges increase due to lower average outstanding borrowings and a steady weighted-average interest rate of 5.1 percent for the quarters ended March 31, 2026 and 2025.

Increased interest charges were also offset by higher capitalized interest during the current period of $1.4 million associated with capital projects.

For the quarter ended March 31, 2026 compared to the quarter ended March 31, 2025

Income tax expense was $21.4 million and $18.4 million for the quarters ended March 31, 2026 and March 31, 2025, respectively, resulting in an effective income tax rate of 26.5 percent and 26.6 percent, respectively, during the periods then ended.

F INANCIAL P OSITION , L IQUIDITY AND C APITAL R ESOURCES

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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.

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/DSPP and ATM program.

Depending on our capital needs and subject to market conditions, in addition to other possible debt and equity offerings, we may consider issuing additional shares under the direct share purchase component of the DRIP/DSPP and/or under our ATM equity program.

Our energy businesses are weather-sensitive and seasonal.

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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.

Our capital expenditures were $121.9 million for the three months ended March 31, 2026.

In the table below, we have provided the range of our forecasted capital expenditures for 2026:

(in millions) Low High

Regulated Energy:

Natural gas distribution

$ 170.0 $ 175.0

Natural gas transmission

Electric distribution

Total Regulated Energy

Unregulated Energy:

Propane distribution

Energy transmission

Other unregulated energy

Total Unregulated Energy

Corporate and other businesses

Regulated distribution $ 110.0 $ 120.0

Regulated transmission 135.0 145.0

Regulated infrastructure 90.0 100.0

Unregulated business 25.0 35.0

Total 2026 Forecasted Capital Expenditures $ 450.0 $ 500.0

The 2026 projection excludes potential acquisitions due to their opportunistic nature.

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 2025 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.

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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

The following table presents our capitalization, excluding and including short-term borrowings, as of March 31, 2026 and December 31, 2025:

March 31, 2026 December 31, 2025

(in millions)

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Total capitalization, excluding short-term debt $ 2,977.0 100 % $ 2,925.6 100 %

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

(in millions)

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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.

Our equity to total capitalization ratio, including short-term borrowings, was 50 percent as of March 31, 2026.

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.

We may, from time to time, allow our capital structure to fall below the target range to align the completion of large capital projects with the respective permanent financing.

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, subject to an effective shelf registration statement.

For the three months ended March 31, 2026 and 2025, we received net proceeds of $5.1 million and $19.8 million, respectively, associated with shares issued under the DRIP/DSPP as well as shares issued under our ATM program.

Shelf Agreements

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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.

At March 31, 2026, a total of $343.3 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.

As of March 31, 2026, we are authorized by our BOD to borrow up to $450.0 million of short-term debt, as required.

At March 31, 2026 and December 31, 2025, we had $199.6 million and $158.0 million, respectively, of short-term borrowings outstanding at a weighted average interest rate of 4.66 percent and 4.73 percent, respectively.

There were no borrowings outstanding under the sustainable investment sublimit of the 364-day tranche at March 31, 2026.

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.

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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.

As of March 31, 2026, we were in compliance with this covenant.

Our total available credit under the Revolver at March 31, 2026 was $245.6 million.

As of March 31, 2026, we had issued $4.8 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.

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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.

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,

The following table provides a summary of our operating, investing and financing cash flows for the three months ended March 31, 2026 and 2025:

Three Months Ended

(in millions) 2026 2025

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Financing activities 26.6 20.9

Net decrease in cash and cash equivalents (6.1) (3.3)

Net increase (decrease) in cash and cash equivalents 2.9 (7.2)

Cash and cash equivalents—beginning of period 1.8 7.9

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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.

During the three months ended March 31, 2026, net cash provided by operating activities was $118.0 million.

Operating cash flows were primarily impacted by the following:

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• An increased level of deferred taxes associated largely with incremental tax depreciation from growth investments resulted in a source of cash of $20.0 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;

• Other working capital changes resulted in a $3.5 million use of cash.

• Working capital changes resulted in a $8.8 million source 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.

Net cash used in investing activities totaled $141.7 million during the three months ended March 31, 2026, primarily attributable to $141.9 million related to new capital expenditures.

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:

• 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;

Net cash provided by financing activities totaled $26.6 million during the three months ended March 31, 2026 and was largely impacted by the following:

• Net borrowings under the Revolver of $42.0 million;

• A $16.2 million use of cash for dividend payments in 2026.

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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.

The maximum authorized liability under such guarantees and letters of credit as of March 31, 2026 was $81.0 million.

The aggregate amount guaranteed related to our subsidiaries at March 31, 2026 was $52.4 million , with the guarantees expiring on various dates through March 2027 .

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.

The amount of specific purpose guarantees outstanding at March 31, 2026 was $4.0 million.

As of March 31, 2026, we have issued letters of credit totaling $4.8 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 October 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.

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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.

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.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis