Good morning, and thank you all for attending the Northwest Natural Holdings Company Second Quarter 2025 Earnings Call. My name is Brika, and I will be your moderator for today. [Operator Instructions] I would now like to pass the conference over to your host, Nikki Sparley, Head of Investor Relations. Thank you. You may proceed, Nikki.

Thank you. Good morning, and welcome to our second quarter 2025 earnings call. A presentation for today's call is available on our Investor Relations website at irnwnaturalholdings.com. And following this call, a recording will also be available on our website. Turning to Slide 2. As a reminder, some things that will be said this morning contain forward-looking statements. They are based on management's assumptions, which may or may not occur. For a complete list of cautionary statements, refer to the language at the end of our press release. Additionally, our risk factors are provided in our 10-Q and 10-K filings. We will also refer to certain non-GAAP financial measures. For additional disclosures about these non-GAAP measures, including reconciliations to comparable GAAP results, please see the slides that accompany today's call, which are available on the Investor Relations page of our website. Please note, our guidance assumes continued customer growth, average weather conditions and no significant changes in prevailing regulatory policies, mechanisms or assumed outcomes or significant changes in local, state or federal laws, legislation or regulations. For context, we have 3 business segments: our Northwest Natural Gas Utility, our SiEnergy Gas Utility and our Northwest Natural Water Utility, our other category includes our Interstate Storage Services, asset management services, Northwest Natural Renewables and holding company expenses. As a reminder, our gas utility earnings are seasonal with a majority of revenues and earnings generated in the first and fourth quarters during the winter heating months. We expect to file our 10-Q later today. Please note, these calls are designed for the financial community. If you are an investor and have additional questions after the call, please contact me directly at (503) 721-2530. News Media may contact David Roy at (503) 610-7157. Moving to Slide 3. With us today are Justin Palfreyman, President and Chief Executive Officer; and Ray Kaszuba, Senior Vice President and Chief Financial Officer. Justin will update on each of our businesses, and Ray will walk through our financial results, liquidity and financing and guidance. After Justin and Ray's prepared remarks, they will be available along with other members of our executive team to answer your questions. With that, I will turn it over to Justin on Slide 4.

Thanks, Nikki. Good morning, and welcome, everyone. I am pleased to report that Northwest Natural Holdings had a solid second quarter and first half of 2025. We continue to execute well on initiatives across all of our businesses and we remain confident that our financial results are on track for the year. We reported adjusted net income of $2.28 per share in the first 6 months of 2025 compared to net income of $1.60 per share for the same period last year. Our combined utility customer growth rate was 10.6% for the 12 months ended June 30, 2025. This substantial growth was driven by our gas utilities in Texas. Northwest Natural Water also contributed incremental meter growth, posting a 5.8% increase. We reaffirmed our annual 2025 adjusted earnings guidance today and continue to expect our long-term earnings per share growth rate to be 4% to 6%. While our growth and financial metrics are strong, the real momentum lies in how we're executing against our strategic priorities for 2025. Moving to Slide 5. Our key initiatives are translating into tangible outcomes, and we're progressing well toward our full year targets. Turning first to our Northwest Natural Gas Utility. After careful consideration, we filed an Oregon general rate case in December 2024 to recover our critical investments in gas infrastructure and expenses related to providing safe and reliable service to customers. Northwest Natural and parties have been working collaboratively and constructively. Last month, parties filed a settlement resolving Northwest Natural's revenue requirement components of the case. That included a revenue requirement increase of $21.3 million. The settlement also included a 50-50 capital structure, an ROE of 9.5%, an increase from the previous 9.4% and a cost of capital of approximately 7.12%. In addition, rate base would increase $144 million since the last…

Thank you, Justin, and good morning, everyone. Turning to Slide 6. We reported adjusted net income of $315,000 or $0.01 per share for the second quarter of 2025 compared to a loss of $2.8 million or $0.07 per share for the same period in 2024. Adjusted net income excludes the effects of transaction and business development costs. The improvement in net income reflected higher margin from new rates at our Oregon gas utility, partially offset by higher O&M expense, depreciation and interest expense. For our Northwest Natural Gas segment, net income increased $4.5 million or $0.12 per share. Margin increased $16.9 million, mainly due to new rates in Oregon effective November 1, 2024. O&M increased $6.3 million, mainly reflecting higher payroll and benefits expense. Depreciation and general taxes increased $4.8 million due to continued investment in our system. SiEnergy net income of $1 million or $0.03 per share for the second quarter of 2025. In our first year after the acquisition, margin and net income are trending well and in line with our expectations. Our water segment net income increased $1.8 million or $0.04 per share. The key drivers were new rates at our largest water and wastewater utility in Arizona and additional revenues from the ICH utilities after the acquisition in September 2024. Finally, the adjusted net loss from our other businesses increased $4.2 million or $0.11 per share compared to the same period last year. This increase was primarily due to higher interest expense at the holding company. On Slide 7, we've outlined our year-to-date results. Adjusted net income was $92.1 million or $2.28 per share for 2025 compared to $61 million or $1.60 for the same period of 2024. The year-to-date increase in net income reflected being similar to the second quarter. Namely, strong net income across…

[Operator Instructions] The first question we have comes from Selman Akyol with Stifel.

This is Tim on for Selman. Congrats on the quarter. Just wanted to start off with SiEnergy. It's been under your belt for a couple of quarters, and now you guys have added Pines. So just wondering if you could talk about the growth you're seeing there now maybe versus a quarter or 2 ago when you first kind of acquired it. I know you guys mentioned the impressive backlog, but just curious if you could expand a bit on that.

This is Justin Palfreyman. I appreciate the question. So things are progressing well down in Texas and SiEnergy, I would say, is performing as expected for us this year. As you've probably seen, there's been a lot of discussion about housing slowing down a bit in Texas. And in some of our communities, we've seen signs of that. But overall, there continues to be strong growth down there. A lot of new meter sets in addition to extremely strong backlog growth, as we mentioned on the call. And to give you a little more color on that, we had an annual goal of a certain amount of meters to add to our backlog this year and the business development team has already exceeded that goal by midyear. And so there's just a lot of interest down there, a lot of ongoing growth and Pines just enhances that for us as well.

Got it. That's nice to hear. And then just one last one for me. You guys kind of mentioned a couple upcoming water rate case. Just wondering kind of the scale of those or how big we should expect those to be?

Yes. For the most part, the water rate cases because we have a combination of multiple subsidiaries across our water company. For the most part, the individual water rate cases themselves are relatively small. So in some cases, we're talking less than $1 million of revenue requirement. In some cases, it's more than that, which is why you typically see us executing somewhere between 3 and 5 rate cases a year right now, and you saw that last year as well.

[Operator Instructions] And I can confirm that does conclude the Q&A session today. And I would like to hand it back to Justin for some closing comments.

Well, thanks, everybody, for joining. It was a pretty straightforward quarter. As always, if you have additional questions, please do not hesitate to reach out to Nikki, and thanks again for joining everybody.

Thank you all for dialing in. I can confirm that does conclude the Northwest Natural Holdings Company Second Quarter 2025 Earnings Call. Thank you for your participation. You may now disconnect, and please enjoy the rest of your day.