Chesapeake Utilities Corp (CPK) 2024 Q3 法說會逐字稿

Welcome to Chesapeake Utilities Corporation's third quarter 2024 earnings conference call.

(Operator Instructions)

I'd like to turn the call over to Lucia Dempsey, Head of Investor Relations.

Please go ahead.

Thank you, and good morning, everyone.

Today's presentation can be accessed on our website under the Investors page and events and presentations subsection.

After our prepared remarks, we will open the call up for questions.

On slide 2, we show our typical disclaimers, while I remind you that matters discussed on this conference call may include forward-looking statements that involve risks and uncertainties.

Forward-looking statements and projections could differ materially from our actual results.

The Safe Harbor for forward-looking statements section of our 2023 annual report on Form 10-K provides further information on the factors that could cause such statements to differ from our actual results.

Additionally, the company evaluates its performance based on certain non-GAAP measures including adjusted gross margin, adjusted net income, and adjusted earnings per share.

And the information presented today includes the appropriate disclosures in accordance with the SECs Regulation G. A reconciliation of these non-GAAP measures to the related GAAP measures has been provided in the appendix of this presentation in our earnings release and in our third quarter Form 10-Q.

Here at Chesapeake Utilities safety is our first priority.

We start all meetings with a safety moment and we'll do so here with a moment on motor vehicle safety as highlighted on slide 3.

The time change and shift into cooler temperatures, though we haven't quite seen that yet.

Provides us an opportunity to check and update fluid levels, windshield wipers, roadside emergency supplies, and ensure oil changes are on schedule.

Also be aware of how the time change affects morning and evening visibility and exercise more caution around wet or slippery roads and increased traffic around holiday travel.

I'll now introduce our presenters today.

Jeff Householder, Chair of the Board, President and Chief Executive Officer, will provide an update on demand in our growing service areas, capital investment plan and business transformation efforts, including an update on the Florida City gas integration.

Beth Cooper Executive Vice President, Chief Financial Officer, Treasurer and Assistant Corporate Secretary, will discuss our financial results.

Strong balance sheet and dividend and earnings growth trajectory.

And Jim Moriarty, Executive Vice President, General Counsel And Corporate Secretary and Chief Policy and Risk Officer, will review our regulatory strategy, government affairs efforts, and other company updates.

It's my pleasure to turn the call over to Jeff.

Thank you, Lucia.

Good morning and thanks to all of you for joining our call today.

I'll begin with slide 5.

Adjusted earnings per share this quarter was $0.80 bringing our year-to-date 2024 earnings per share to $3.76. Our results are well aligned with our expectations with strong contributions from both Florida City Gas and our core natural gas operations.

Our year-to-date earnings performance combined with our growth expectations for the remainder of 2024 enable us to reaffirm our full year 2024 adjusted earnings per share guidance of $5.33 to $5.45. Continued expectations of strong demand growth along with our pipeline of capital projects and regulatory initiatives drive customer value and enable us to reaffirm our 2025 and 2028 EPS guidance ranges.

And as I'll discuss in more detail shortly, our 2024 capital growth plan remains on track with $257 million invested in the first nine months of this year and $300 million to $360 million expected for full year 2024.

Turning to slide 6.

I'd like to start with a short update on hurricane season.

Overall, our systems fared well through hurricanes Debby, Helene, and Milton, for which we are grateful.

While we did have a number of electric customers lose power during hurricane Helene, we were able to restore power for the majority of our impacted customers within the first 24 hours.

I'm pleased with the work our teams have been doing to practice our emergency response procedures and improve the quality and resiliency of our infrastructure and systems which enabled us to respond quickly and effectively in communicating with customers and restoring their power.

Our integration of Florida City Gas also continues on track as we make additional progress on standardizing operations, engaging with teammates and exploring investment opportunities to serve a significant growth in our new service areas.

Slide 7 provides additional detail on this growth as we are fortunate to operate in some of the fastest growing areas of the country, enabling us to deploy sustainable capital investments to meet the needs of growing customer demand.

We have another quarter of outstanding customer growth in both Delmarva and Florida with each area again experiencing a 3.9% increase in residential customers in the third quarter of this year relative to the same period last year.

We expect strong population growth to continue in our service areas as evidenced by a substantial number of new residential communities planned or in early stage development in both Delmarva and Florida over the next several years.

Customers want natural gas service in their homes, so we expect these projects will continue to support strong customer growth.

The opportunity to serve increasing customer demand is the basis for our overall growth strategy, which in turn drives sustainable earnings growth.

To achieve this growth, we remain consistently focused on three fundamental drivers to support earnings growth as shown on slide 8.

First, we work hard to identify and prudently deploy investment capital in projects that align with customer demand and enable us to continue providing safe and reliable energy delivery services.

Second, we proactively manage our regulatory agenda to support cost recovery of our capital projects.

Third, and equally as important given our recent and future overall enterprise growth is business transformation which prioritizes continuous improvement initiatives that enable us to ensure long term success in an ever changing environment.

Capital deployment is our primary growth driver.

And on slide 9, you can see that we've made significant progress toward identifying and initiating at least $1.3 billion of our five-year capital investment plan of $1.5 billion to $1.8 billion.

Of particular note, nearly $1 billion of this identified capital requires no additional regulatory approval or support.

While we are fundamentally a regulated utility company, we look for opportunities to leverage our related businesses to work together to meet the needs of customers.

Although our current slate of identified projects reflects significant regulated investment, we are moving forward on identifying additional regulated and complementary nonregulated investments in 2025 and beyond.

Slide 10 shows we are making excellent progress toward our 2024 capital expenditure guidance of $300 million to $360 million, with $257 million invested through September of this year, including approximately $100 million spent in the third quarter alone.

Our team is focused on efficiently deploying the remaining capital through the balance of the year including advancing multiple growth projects that were drivers of our FCG acquisition undertaking capital projects previously approved and implementing technology that supports our ongoing business transformation.

Slide 11 provides additional detail on the major projects that are driving nearly $300 million of capital investment and over $36 million of additional adjusted gross margin in 2024 and '25 across Delmarva and Florida.

All in progress, investments remain on track as we focus on managing these construction projects safely and effectively.

I'd like to note one new project this quarter, Number 18, the Miami Inner Loop.

In September, our Peninsula pipeline company filed for Florida Public Service Commission approval of the Transportation Service Agreement with Florida City Gas for a series of projects to enhance infrastructure in the Miami area.

Referred collectively as the Miami Inner Loop, this expansion will support growth in FCG's distribution system through new transportation projects and system connection points.

Turning to slide 12.

Our third fundamental growth driver is continual business transformation to support long-term enterprise growth.

In August, we successfully implemented a new companywide SAP system, which has operated well over the last three months.

This is a major step to support the operational transformation we've been working towards for the past few years and we're already seeing a number of benefits and efficiencies with our new billing and field services system.

We will also continue to implement additional technology upgrades across the enterprise, including transitioning FCG onto the SAP system next spring and assessing system upgrades to address additional process improvements across the organization.

And with that, I'll turn to Beth to discuss our financial results in more detail.

Thanks Jeff, and good morning everyone.

It is great to be here with you today.

Our financial results as shown on slide 13, demonstrate another quarter of strong growth with adjusted gross margin of approximately $122 million, up 29% from the third quarter of last year, driven by the addition of Florida City Gas as well as solid performance across all of our businesses.

Strong margin growth coupled with operational efficiencies drove significant growth in adjusted net income, up 48% to approximately $18 million for the quarter and up 30% to approximately $84 million for the first nine months of 2024 compared to the same periods in 2023.

We also reported strong growth in adjusted earnings per share this quarter up $0.11 to $0.80, a 15% increase over the third quarter of 2023.

I'll now turn to slide 14 and highlight some of the key drivers of our third quarter 2024 adjusted EPS.

Florida City Gas operations contributed $0.75 in adjusted EPS reflecting another quarter of strong customer growth.

Our legacy natural gas growth, infrastructure and transmission operations generated $0.11 of incremental EPS this quarter, driven by strong demand for natural gas and additional margin from infrastructure projects completed in 2024.

Our Marlin virtual pipeline services delivered an additional $0.04 per share of benefit in the third quarter of 2024 as we expanded offerings for existing and new customers.

Increased consumption in our natural gas distribution business added an additional $0.03 per share.

This quarter.

These gains were partially offset by a few factors including primarily $0.28 of operating expenses related to Florida City Gas, $0.02 of increased expenses related to payroll and insurance expenses, and approximately $0.46 related to financing the Florida City Gas acquisition.

Moving to slide 15.

Adjusted gross margin for our regulated energy segment was approximately $102 million this quarter, up 35% from the third quarter of last year.

Operating income also grew substantially up 76% to $44 million excluding nonrecurring transaction and transition costs.

This improvement was primarily driven by: first, strong earnings contribution from Florida City Gas; secondly, organic growth in our natural gas distribution operations: and finally, incremental margins from our transmission service expansions and regulated infrastructure programs.

As shown on slide 16, our unregulated energy segment also delivered solid improvements relative to the third quarter of last year, with adjusted growth margin of 6% to approximately $20 million for the third quarter of 2024.

As just discussed, an increase in our Marlin virtual pipeline services drove the majority of the improvement in our unregulated business this quarter and we look forward to continuing to grow that business based upon the increasing demand we see in the market.

I'll now shift to slide 17 to review our capital structure and financing plan.

Maintaining a strong balance sheet, adequate liquidity, and access to competitively priced capital is critical to support our capital investment plan.

To this end, we continue to execute on a financing plan consistent with an investment grade credit profile.

Our liquidity also remained strong this quarter with nearly 70% of our revolving credit facility and private placement shelf facilities available at the end of September.

We ended the third quarter of 2024 with an equity to total capitalization ratio of 49%, up from 47% at the end of 2023.

Which is on the cusp of our target equity to total capitalization range of 50% to 60% as we've already issued approximately $64 million in equity through September of this year.

Primarily via our existing equity programs including the dividend reinvestment and direct stock purchase plan.

Lastly, on November 1, 2024, we issued $100 million of 5.20% senior notes due October 2029 to further strengthen our balance sheet and support our capital growth plan.

Slide 18 shows our strong history of consistent dividend growth of approximately 9%.

Our dividend is a key component of our balanced capital allocation strategy and our current target payout ratio is designed to return value to shareholders, while also allowing for earnings reinvestment to fund future growth capital investment.

We believe this strategy enables our investors to benefit from long term top quartile earnings and dividend growth.

Speaking of earnings growth, slide 19 demonstrates our consistent earnings per share performance with our 2028 EPS guidance range reflecting a 10-year EPS growth CAGR of approximately 8.5%.

Our year-to-date 2024 performance is in line with our expectations, enabling us to reaffirm our 2024 adjusted EPS guidance range of $5.33 to $5.45 per share including the acceleration towards our target capital structure.

Similarly, we are also reaffirming our 2025 guidance of $6.15 to $6.35 per share and our 2028 guidance of $7.75 to $8.00 per share.

Finally, slide 20 shows our path to our full year 2024 EPS guidance range of $5.33 to $5.45. We remain on track with strong contributions from our legacy business and acquisition of Florida City Gas offset only by the impacts from the acquisition financing.

With that, it's my pleasure to turn the call over to Jim.

Thank you, Beth and good morning everyone.

As Jeff discussed earlier, the proactive regulatory agenda is our second fundamental growth driver.

And I would like to share several updates in this area as shown on slide 21.

For our Maryland jurisdiction in September 2024, we received approval for a $2.6 million revenue increase.

On November 7, we filed a Phase 2 proceeding to determine a schedule for incorporating this increase into customer rates.

On August 12, we filed a rate case in our Delaware jurisdiction proposing a $12.1 million rate increase and an ROE of 11.5%.

We also requested interim rate relief of $2.5 million, which was approved with an effective date of October 11, 2024.

On August 22, we filed a rate case for our Florida Electric operations proposing a $12.6 million rate increase and an 11.3% ROE.

That filing also included a request for $1.8 million in interim rates which were approved with an effective date of November 1, 2024.

We look forward to constructive conversations with our regulators on these filings in order to implement updated rates in the first half of 2025.

We also continue to move forward with sustainable investments and recently reached an important milestone at our Full Circle Dairy RNG facility as shown on slide 22.

We have completed commissioning at Full Circle Dairy and hosted a ribbon cutting ceremony last week to mark the start of full RNG production operations.

Since the start of test production in June, nearly 21,000 decatherms of RNG have been captured at Full Circle and injected into our system in Yulee, Florida by our Marlin virtual pipeline capabilities.

The site reached an additional milestone last week when it received qualified RIN status, or Q-RINS, which allows Full Circle Dairy to generate the highly regarded D3 RINS.

This qualification also enabled us to generate and monetize RINS for all historical production to date.

Overall, our RNG strategy will continue to evolve as the market matures, and we will evaluate opportunities that enable us to use our existing transportation services and construction expertise to provide pathways to market for RNG producers.

Slide 23 provides an update on our Eastern Shore Worcester Resiliency Upgrade or WRU project, which is an $80 million liquefied natural gas storage project designed to support growth and resiliency on the Delmarva region.

In September, members of our operations services team traveled to South Korea to meet with the manufacturer of the five low profile LNG tanks.

Production remains on schedule and the team was pleased with the quality of the production and the efficiency of the organization overall.

We anticipate FERC approval by the end of 2024 and remain on track for construction to begin in the first quarter of 2025 for an in service date in the third quarter of 2025.

On the legislative front, we remain focused on maintaining consistent dialogue with governing bodies at the local state and federal levels.

In order to further strengthen and expand our relationships and ensure an understanding of the demands of the communities and customers we serve to deliver affordable, reliable, and domestic energy.

We are preparing to work with the new administration in Congress, along with the state and local political leadership as the next legislative sessions begin in January.

We expect a continued focus on energy and tax policy while offering opportunities to educate our elected representatives on the work that we do and advocate for what our customers and communities seek.

The efficient delivery of affordable, reliable, and domestic natural gas so that no one is left behind.

Turning now to slide 25.

I would like to cover our sustainability initiatives and recent community engagements.

In September, we published our second micro sustainability report which focuses on our environmental stewardship efforts.

In addition to providing additional information on our environmental commitments to our communities, we reported a 25% reduction in scope one and scope two greenhouse gas emissions since 2019 and a 10% reduction in emissions from 2022 to 2023.

Our third micro report, which will focus on community impact, DEI initiatives and our investments in people, communities and customers will be released in early 2025.

In the aftermath of Hurricanes Helene and Milton, the company donated $50,000 across three organizations to support recovery efforts in heavily affected areas.

We consider it vital to stand with our fellow utility companies and communities impacted by the hurricanes to provide essential services to those in need.

Delivering excellence for all stakeholders is the foundation for long-term growth and success, enabling us to continue serving our customers and driving value for our shareholders for years to come with that.

I will turn the call to Jeff for concluding remarks.

Thanks, Jim.

This year has been a critical turning point as we demonstrate our ability to integrate the meaningful acquisition of FCG.

Deliver on our 2024 EPS and capital guidance ranges and position the organization to achieve the significant growth embedded in our 2025 EPS guidance through capital investments and regulatory initiatives.

We have continued to execute on our plan this past quarter, including delivering financial results that remain in line with our full year expectations and represent top quartile earnings performance.

While the weather has provided a less favorable backdrop as we began the fourth quarter, we will remain focused on our three key growth pillars throughout the remainder of 2024 and look forward to updating you on our full year accomplishments and forward-looking goals for 2025 and beyond.

With that, we'll take your questions.

Operator?

(Operator Instructions) Tate Sullivan, Maxim group.

Thank you.

I'm sorry if I missed it, but thank you.

Beth, you cover the short term impact to your service territories from the hurricanes.

But does this help increase the amount of spending you can do in the future on the ongoing storm hardening infrastructure work or is there something in future rate cases that will help you increase the rate case related to that?

Thank you, Tate and good morning.

First off, I would say, we were very fortunate in that the service areas that we're primarily serving in the state.

There was minimal impact to our operations.

And so, as we talked about on the call, Jeff mentioned we had customers that were out of service for a little less than 24 hours.

So in terms of CapEx and what we're doing in terms of our storm protection and an improvement plan, those plans continue, nothing has really changed or accelerated because of the hurricanes.

What we did see and we'll continue to see is that our system is becoming more and more reliable and resilient, and that was certainly the case with these three.

Thank you.

And Jeff, can you comment on the Florida City Gas?

I mean, the customer count, average customers increased quarter-over-quarter.

Should we just look at it, the customer growth opportunity set with Florida City Gas is very similar to the growth of Florida Natural Gas distribution in general?

Or are different pockets of higher growth?

I think in general they are very similar.

We're certainly seeing significant activity on city gas' system in the Port Saint Lucie area.

I mean, that continues to be an area of substantial growth as the population in South Florida kind of continues to migrate a little farther north.

Although we're happy with what we see in the -- certainly in the Brevard County areas and in Miami as well.

But Saint Lucie is probably the big driver of growth from a residential customer perspective.

Now, if you look to commercial industrial things move around a little bit.

We're seeing significant opportunities in the Miami area relative to those customer classes.

And again on FBU'S territory in Florida, lots of development in our central Florida areas.

So we're still seeing the Wildlight development up in Nassau County almost into Georgia, growing by leaps and bounds.

So we're pretty happy with what we see.

I think we've been reporting about a 3.9% growth rate in residential customers and we frankly see that continuing into the future.

Okay, thank you.

Paul Fremont, Ladenburg.

Hey, congratulations.

I guess my first question.

My first question has to do with, are you taking any regulatory action in advance of a possible Supreme Court decision that's coming up in Florida in the first quarter of '25 on RSAM?

Well, there is currently -- there's a hearing scheduled as it relates to the RSAM proceeding and we will certainly be participating in that.

And what I would say, Paul, as we've discussed and we've talked about in the past, certainly, there is that second tranche of RSAM and that will -- where if we're able to pursue that we'll certainly rest with what happens with this proceeding.

But keep in mind, we at legacy Chesapeake historically have approached the whole depreciation realm, thinking about it from a depreciation study perspective.

So that same opportunity or bucket of dollars is out there, whether it's looked at under an RSAM mechanism or whether we would like to pursue it more as a traditional type of depreciation study.

So we're following that proceeding very closely.

But again, we see opportunities given how we've historically pursued depreciation studies.

I was going to ask Jim to comment.

Good morning, Paul.

Hope all is well.

We are looking forward to the oral argument on December 10 of the Florida Supreme Court and we'll be helping others defend the decision of the Florida Public Service Commission.

As you can imagine, we do a lot of thinking about what that means and what it could be.

So as Beth stated, we're fully engaged on the issue and we're looking for a positive outcome.

But if not, we'll make sure to bring it back in under our depreciation approach.

So, I mean, I take it by your answer, you're going to wait until the Supreme Court issues its final decision before initiating any regulatory action.

Is that fair?

We are evaluating whether or not, we will await that we haven't made any final decisions.

Certainly, we will announce if we decide to go down that path, but we're still looking at it, Paul, we've been following it very closely.

Great.

Also, I guess how does the Republican control on a federal level impact potential investment opportunities that you might have in either your pipeline business or LNG, adding to your LNG regasification?

I think it's a very good question, Paul and one that we're evaluating as well.

We have always had a very favorable constructive relationship with our federal regulators and at FERC and elsewhere.

And any time we've had a project on the front end, we work closely with all the stakeholders so that there were few of any protests to what we would propose.

And we'll continue that approach.

I think what you'll find is a lot of doors opening maybe a little quicker than they did in the past.

But we're very excited about our Worcester or Resiliency project on the Eastern shore.

So I think we're going to see a lot of wind at our backs in the energy industry generally as we go forward and try and make sure that this country continues to benefit from all the resources we have here domestically.

And then last question for me in terms of the Phase 2 Maryland proceeding, will that also deal with the unification of the three franchises?

That's the plan, Paul.

We made the filing yesterday on Phase 2.

And now the other parties will weigh in and then we'll all see before the ALJ.

Great.

Thank you so much.

Thank you, Paul.

Thank you.

(Operator Instructions) Chris Ellinghaus, Sebert Williams Shank.

Jeff, is there anything that through the FCG integration at this point that you've learned either about operations or about incremental investment opportunities that were not what you were expecting?

I think the level of potential opportunity has probably increased a little bit from what we were expecting before we got a good look at the unit.

Nothing outrageously higher than what we had been reporting, but there's certainly growth there that we're pretty happy with.

We're also seeing some operational synergies that we're beginning to to harvest frankly.

They also at City Gas had a number of things like a 24/7 emergency call response center, that we've been able to leverage in our other operations areas.

And so there are a variety of things like that, that we're seeing that I think promote the sort of synergies that we were hoping to find along with the growth opportunities that are a little bit more robust probably than we had originally anticipated.

So far it's a -- we haven't had any particular shocks to the system from acquiring that unit.

It's been more favorable generally speaking, I would say.

Beth, I don't know if you have anything to add to that.

No.

I would agree.

I think, you've already seen those three RNG projects, you've seen the SAFE Investment program increased by $50 million.

We've gone in for that.

We've made some other filings that actually take the best of what both entities are doing.

So overall, I don't think -- I think Chris, where you were going, is there anything that may be more negatively?

We've seen, I would say no, the opposite is true.

Yeh.

The Miami Loop project, the Inner Loop project that we're talking about on this call is a good example of that.

That's a $70 million project.

We had assumed that we would be able to do things like that.

But I think now Beth, we're probably a project.

The Miami Inner Loop, I think is project number 12.

That we filed with the PSC in Florida for small scale transmission expansions.

A lot of that surrounding certainly the Miami area.

And so I think we'll see additional projects like that as we began to try to provide for a more robust delivery of gas capacity into South Florida.

Okay, great.

Yeah, I wanted to ask you about the Inner Loop project.

What's the timeline for that?

Yeah, we filed that, a handful of weeks ago.

I guess fairly recently.

I don't have the exact date off the top of my head.

I would expect the commission to look at that over the next two or three months.

And we will begin construction hopefully sometime in Q1 of next year.

It's a fairly significant set of projects as we've described.

And so we'll put that into service at least partially next year.

And it will begin to do exactly what we are trying to do, which is to improve the deliverability of gas service into places in South Florida, especially Miami, where we're seeing growth and opportunity.

Especially in some of the -- we're seeing a lot of onshoring and reshoring of manufacturing these days across the industry and we're seeing that in things like cement production in South Florida coming back into the country.

And so we have opportunities to increase deliverability in the South Florida and take advantage of those industrial increases.

So that's what we're trying to do.

Okay, great.

On slide 20, you've been showing us this one bucket of additional opportunities for the year.

Can you provide any color on, where you stand in that bucket and what sort of -- what you've been reaping so far?

So that, Chris, includes opportunities that we have in both, on Delmarva and in Florida as we look across the enterprise.

So again, there are things that we're doing, for example, from a control room perspective, there are things that we're doing as it relates to some of the infrastructure programs and the management and some of those savings and costs that are happening there.

You're seeing a lot already.

If you look at our expenses for the quarter and look at it on a year-to-date basis, there's really three things that are happening.

Number one, it's those synergies, some of which I just mentioned.

Number two, you're seeing our business transformation efforts continue in the third quarter, we went live with our project 1CX in our utility billing system in our legacy operations.

And that has created not only efficiencies in how we do things, but also, there's some increased capitalization of costs as we're implementing that technology.

And then as you kind of move down that list and look at some of those other things, we're in very active on the regulatory front in various jurisdictions.

We've been successful in Maryland I know the timing, there is a little push back, but we've been successful.

And so with all of those things coupled with even the most recent debt placement and where we were able to place that debt.

So there's a lot of things as we lay out year end, you're going to see, there's just many things that are going on across this enterprise that are working to positively help us stay within that guidance range.

Okay.

That helps.

One more thing, can you give us any color on what was involved in the Marlin improvement in the quarter?

So there's been a real focus there and a shout out to the management within our Marlin team who's had a focus really over the last year, we've talked about it in terms of the types of contracts and projects that we're entering into.

So we're focused on number one, let's ensure that we're locking in contracts that look like longer term contracts and are not more emergency one time, you can't recur type contracts.

So that's been the first thing.

The second thing that's been happening and you're hearing us talk about our role in RNG transportation.

We're having more and more projects that we're taking on and services that we're providing kind of like on hold services.

And Jeff, I don't know if there's anything else you'd want to add there.

Maybe just one comment.

We spent a fair amount of time over the last handful of years of building the asset base in Marlin so that we actually could look at that whole unit from a more commercial point of view.

And we have done that, and we've moved a guy Justin Stankiewicz into that role that has a commercial view of the marketplace.

He also has been running our renewable gas operations for a while.

And so that marriage between getting the tanks and the trucks and everything, the compressors and all the other equipment and assets we needed together at Marlin to actually take it out and begin to market it, has now come to pass and we've got people there that are interested in going out and looking for business that we now have the opportunity to actually satisfy the orders that come in.

And so we're seeing a lot of that occurring and we'll continue going forward to balance that commercialization of the business with the asset needs of the business and try to keep the kind of progress and success that you're seeing going.

Okay.

Thanks.

Appreciate the details, everybody.

Thank you, Chris.

Thank you.

And it appears that there are no further questions at this time.

I will now turn the program over to Jeff Householder for closing remarks.

Well, thank you very much for joining us.

We always appreciate the interest in Chesapeake Utilities.

I hope you have a great thanksgiving, and we'll talk to you soon.

Thank you.

This concludes Chesapeake Utilities Corporation's third quarter 2024 earnings conference call.

Please disconnect your line at this time and have a wonderful day.