National Fuel Gas Company

National Fuel Gas Company produces and gathers natural gas in Pennsylvania and owns regulated gas utilities, pipelines and storage assets. Its common shares trade on the New York Stock Exchange under NFG. Its fiscal year ends September 30.

Results through fiscal 2026

The company defines free cash flow as operating cash less net investing cash use, adjusted for acquisitions and divestitures. It includes other investing flows as well as capital spending. Higher cash investment meant this measure declined despite stronger operating cash flow. Cash dividends used $202.8 million in fiscal 2026; there were no purchases under the ordinary share repurchase plan.

Fourth-quarter revenue was $467.8 million, compared with $456.4 million a year earlier. Net income fell to $97.5 million from $107.3 million, and diluted earnings per share to $1.02 from $1.18. Adjusted earnings were $111.9 million versus $111.0 million, with adjusted earnings per share unchanged at $1.22.

July's latest fiscal 2026 adjusted earnings target was $7.40 to $7.60 a share; the final $7.55 was within that range. Production of 419.5 billion cubic feet was slightly below July's 420 billion to 430 billion range. The company had described appraisal activity and well interactions as near-term production constraints.

Initial fiscal 2027 outlook

Adjusted earnings guidance is $6.00 to $6.40 a share, including the completed Ohio acquisition and the production and gathering business for the full fiscal year. The forecast assumes NYMEX gas of $2.85 per million British thermal units and in-basin spot gas of $2.15.

The fiscal 2026 adjusted result removes Ohio acquisition costs, financing effects and share issuance dilution. The 2027 outlook includes the acquired operations and financing. The historical reconciliation removes $0.17 a share for the equity issuance net of interest benefits and $0.05 for debt financing. Those historical amounts are not estimates of a full year's 2027 financing costs.

Utility operating income is expected at $235 million to $255 million, compared with $122.6 million in fiscal 2026. Pipeline and storage revenue is expected at $475 million to $500 million, compared with $431.7 million including intersegment revenue. Growth reflects Ohio, utility rate changes and pipeline expansion projects.

Production guidance is 400 billion to 435 billion cubic feet. Fiscal 2027 is a development transition year after appraisal results and well interactions affected recent output. Management plans to adjust well completion designs and development sequencing, with growth expected from fiscal 2028.

About 65% of expected 2027 production has a financial hedge or fixed-price arrangement. Approximately 50% has swaps or fixed-price physical sales; another 15% uses collars, which set floors and ceilings rather than a single fixed price.

Total capital guidance is $1.09 billion to $1.22 billion, plus $50 million to $100 million of possible discretionary land spending. The base includes $600 million to $640 million for production and gathering, $140 million to $180 million for pipelines and storage, and $350 million to $400 million for utilities.

Completed Ohio and storage purchases

The CenterPoint Ohio gas utility acquisition closed October 1, 2026, for $2.62 billion, subject to adjustments: $1.42 billion in cash plus a $1.2 billion seller note. It added about 335,000 customers and doubled utility rate base. The note bears 6.5% annual interest and matures September 30, 2027.

Honeoye Storage closed October 30 for $5 million, adding about 6 billion cubic feet of fully subscribed storage capacity. Neither October acquisition contributed to the fiscal year ended September 30.

Financing and planned separation

At September 30, cash and temporary cash investments were approximately $39.4 million, with a separate $1.440 billion held in escrow before the Ohio closing. Long-term debt had a $3.268 billion carrying value excluding $300 million classified as current. Bank notes and commercial paper were another $380 million. The October seller note is additional to these pre-closing balances.

June financing issued $1.5 billion of notes in three equal tranches due 2029, 2031 and 2036. It funded part of Ohio and refinanced a $300 million maturity. The current annual dividend rate is $2.22 a share.

The October 14 separation plan would create an independent production and gathering company expected to be called Seneca Resources. National Fuel would retain regulated utility, pipeline and storage operations and initially a minority interest in Seneca.

The company targets the second half of calendar 2027, subject to financing, required filings and final board approval. Existing National Fuel shareholders would receive Seneca shares in a pro rata distribution intended to be tax-free for U.S. federal income tax purposes. Current guidance includes the production business for the full fiscal year; the final separation structure and financing will determine the two companies' subsequent earnings bases.