National Fuel Gas Company (NYSE:NFG) Q4 2023 Earnings Conference Call November 2, 2023 10:00 AM ET

Company Participants

Brandon Haspett - Director-Investor Relations

David Bauer - President and Chief Executive Officer

Timothy Silverstein - Treasurer and Principal Financial Officer

Justin Loweth - President-Seneca Resources and National Fuel Midstream

Conference Call Participants

Umang Choudhary - Goldman Sachs

Zach Parham - JPMorgan

John Abbott - Bank of America

Trafford Lamar - Raymond James

Operator

Good morning and thank you for joining the National Fuel Gas Company Q4 Fiscal 2023 Earnings Conference Call. My name is Kate and I will be the moderator for today's call. All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end.

I would now like to turn the call over to your host, Brandon Haspett, director of Investor Relations. You may proceed.

Brandon Haspett

Thank you, Kate and good morning. We appreciate you joining us on today's conference call for a discussion of last evening's earnings release. with us on the call from National Fuel Gas Company, are Dave Bauer, president and Chief Executive Officer; Tim Silverstein, treasurer and Principal Financial Officer and Justin Loweth, president of Seneca Resources and National Fuel Midstream.

At the end of the prepared remarks, we'll open the discussion to questions. The fourth quarter fiscal 2023 earnings release in November Investor Presentation have been posted on our Investor Relations website. We may refer to these materials during today's call. We'd like to remind you that today's teleconference will contain forward-looking statements. While national Fuel's expectations, beliefs and projections are made in good faith and are believed to have a reasonable basis, actual results may differ materially. These statements speak only as the date on which they're made and you may refer to last evening's earnings release for a listing of certain specific risk factors.

With that, I'll turn it over to Dave Bauer.

David Bauer

Thank you, Brandon. Good morning, everyone. Fiscal '23 was a good year for National Fuel, both financially and operationally, and one that positions the company for growth in the years ahead. Seneca's production was up 9% over the last year, averaging over 1 Bcf per day net. cash operating costs continued to trend downward as we build scale at Seneca.

Commodity prices were a headwind during the year, but our consistent approach to hedging mitigated a lot of the pricing impacts and protected a substantial portion of our earnings and cash flows. Earnings at our regulated businesses were down slightly due to cost inflation and the associated regulatory lag, but recent rate proceedings in all three jurisdictions should reverse that trend. Most importantly, we generated $275 million of free cash flow during the year, roughly in line with the nearly $300 million of combined free cash flow and proceeds from asset sales in fiscal '22.