NEW JERSEY RESOURCES CORP

NJNG's operating results are as follows:

(1)Includes immaterial nonutility revenue for lease agreements with various NJR subsidiaries leasing office space from NJNG at the Company’s headquarters, which are eliminated in consolidation.

(2)Includes the purchased cost of the natural gas, fees paid to pipelines and storage facilities, adjustments as a result of BGSS incentive programs and hedging transactions. These expenses are passed through to customers and are offset by corresponding revenues.

(3)Includes related party transactions of approximately $1.6M and $2.3M during the three months ended March 31, 2026 and 2025, respectively, and $3.2M and $4.7M during the six months ended March 31, 2026 and 2025, respectively, a portion of which is eliminated in consolidation.

(4)Consists of expenses associated with state-mandated programs, the RAC and energy efficiency programs, which are calculated on a per-therm basis. These expenses are passed through to customers and are offset by corresponding revenues.

Operating Revenues and Natural Gas Purchases

Operating revenues increased 3.6% and natural gas purchases increased 0.5% during the three months ended March 31, 2026, compared with the three months ended March 31, 2025. Operating revenues increased 10.4% and natural gas purchases increased 10.4% during the six months ended March 31, 2026, compared with the six months ended March 31, 2025.

Part I

The factors contributing to the increases and decreases in operating revenues and natural gas purchases are as follows:

(1)Riders and other includes changes in rider rates, including those related to SAVEGREEN, NJCEP and other programs, which is offset in regulatory rider expense.

Management uses Utility Gross Margin, a non-GAAP financial measure, when evaluating the operating results of NJNG. NJNG's Utility Gross Margin is defined as operating revenues less natural gas purchases, sales tax, and regulatory rider expenses. This measure differs from gross margin as presented on a GAAP basis as it excludes certain operations and maintenance expense and depreciation and amortization. Utility Gross Margin may also not be comparable to the definition of gross margin used by others in the natural gas distribution business and other industries. We believe that Utility Gross Margin provides a meaningful basis for evaluating utility operations since natural gas costs, sales tax and regulatory rider expenses are included in operating revenues and passed through to customers and, therefore, have no effect on Utility Gross Margin. Non-GAAP financial measures are not in accordance with, or an alternative to, GAAP and should be considered in addition to, and not as a substitute for, the comparable GAAP measure.

Utility Gross Margin

A reconciliation of gross margin, the closest GAAP financial measure to NJNG's Utility Gross Margin, is as follows:

(1)Excludes SG&A of approximately $51.0M and $31.7M for the three months ended March 31, 2026 and 2025, respectively, and $55.1M and $57.8M for the six months ended March 31, 2026 and 2025, respectively.

Part I

Utility Gross Margin consists of three components:

•Utility firm gross margin generated from only the delivery component of either a sales tariff or a transportation tariff from residential and commercial customers who receive natural gas service from NJNG;

•BGSS incentive programs, where revenues generated or savings achieved from BPU-approved off-system sales, capacity release or storage incentive programs are shared between customers and NJNG; and

•Utility Gross Margin generated from off-tariff and interruptible customers.

The following provides more information on the components of Utility Gross Margin and associated throughput (Bcf) of natural gas delivered to customers:

Utility Firm Gross Margin

Utility firm gross margin increased approximately $6.1M during the three months ended March 31, 2026, compared with the three months ended March 31, 2025, due primarily to customer growth. Utility firm gross margin increased $28.7M during the six months ended March 31, 2026, compared with the six months ended March 31, 2025, due primarily to an increase in base rates, effective November 21, 2024, along with customer growth.

BGSS Incentive Programs

The factors contributing to the change in Utility Gross Margin generated by BGSS incentive programs are as follows:

BGSS incentive programs increased during the three months ended March 31, 2026, compared with the three months ended March 31, 2025, due primarily to higher margins from off-system sales and capacity release, related to market volatility due to colder weather. BGSS incentive programs increased during the six months ended March 31, 2026, compared with the six months ended March 31, 2025, due primarily to higher margins from off-system sales and storage.

Net Income

Net income increased approximately $4.0M during the three months ended March 31, 2026, compared with the three months ended March 31, 2025, due primarily to the following factors:

•$10.3M increase in Utility Gross Margin, as previously discussed; partially offset by

•$4.5M increase in O&M due to higher employee expenses.

Part I

Net income increased approximately $20.9M during the six months ended March 31, 2026, compared with the six months ended March 31, 2025, due primarily to the following factors:

•$35.3M increase in Utility Gross Margin, as previously discussed; partially offset by

•$6.7M increase in depreciation expense as a result of additional utility plant being placed into service;

•$3.8M increase in interest expense due to higher outstanding long-term debt; and

•$3.4M increase in income tax expense related to higher operating income.