National Fuel Reports Second Quarter Earnings

WILLIAMSVILLE, N.Y., May 06, 2021 (GLOBE NEWSWIRE) -- National Fuel Gas Company (“National Fuel” or the “Company”) (NYSE:NFG) today announced consolidated results for the second quarter of its 2021 fiscal year and for the six months ended March 31, 2021.

FISCAL 2021 SECOND QUARTER SUMMARY

• GAAP net income of $112.4 million, or $1.23 per share, compared to GAAP net loss of $106.1 million, or $1.23 per share, in the prior year.
• Adjusted operating results of $123.2 million, or $1.34 per share, compared to $84.2 million, or $0.97 per share, in the prior year (see non-GAAP reconciliation on page 2).
• Adjusted EBITDA of $298.4 million, an increase of 29%, compared to $231.1 million in the prior year (see non-GAAP reconciliation on page 23).
• Pipeline & Storage segment Adjusted EBITDA of $58.6 million, an increase of 19% from the prior year.
• Gathering segment Adjusted EBITDA of $41.4 million, an increase of 40% from the prior year.
• E&P segment Adjusted EBITDA of $127.1 million, an increase of 59% from the prior year.
• E&P segment net production of 85.2 Bcfe, an increase of 25.5 Bcfe, or 43%, from the prior year.
• E&P segment cash operating costs (combined G&A expenses, LOE expense, other operation and maintenance expense, and property, franchise, and other taxes), of $1.09 per Mcfe, a 14% decrease from the prior year.
• Average realized natural gas prices of $2.28 per Mcf, an increase $0.16 per Mcf from the prior year.
• Average realized oil prices of $57.11 per Bbl, a decrease of $1.12 per Bbl from the prior year.
• Utility segment announced greenhouse gas emissions reduction targets for its delivery system of 75% by 2030, and 90% by 2050, from 1990 levels.
• Company is increasing its fiscal 2021 earnings guidance to a range of $3.85 to $4.05 per share, an increase of $0.15 at the midpoint, excluding items impacting comparability (see Guidance Summary on page 7).

MANAGEMENT COMMENTS

David P. Bauer, President and Chief Executive Officer of National Fuel Gas Company, stated: “National Fuel had an excellent second quarter, with significant earnings growth resulting from the ongoing expansion of our interstate pipeline systems and the continued positive impact of our Appalachian upstream and gathering acquisition completed last summer. In light of these strong operating results, we are increasing our earnings guidance for fiscal 2021 to $3.85 to $4.05 per share, representing a 35% increase from the prior year at the midpoint of the updated range.  

“During the quarter, our Pipeline and Storage business commenced construction of our FM100 expansion and modernization project, which remains on track for a late calendar 2021 in-service date. In addition to contributing $50 million in annual revenues to our FERC-regulated pipeline operations, this project, along with the companion Transco Leidy South expansion, is expected to provide additional access to premium markets in the Mid-Atlantic for Seneca’s growing production base. Additionally, we continued to make significant strides on our sustainability-focused initiatives, with our Utility business announcing substantial greenhouse gas emissions reduction goals in March, driven by ongoing investments in the modernization of our natural gas distribution network. Evidencing our commitment to the continued reduction of National Fuel’s carbon footprint, we are working towards emissions reduction targets for the Company's midstream and upstream segments, maintaining our focus on climate-risk and the energy transition, as well as National Fuel’s long-term role in the energy complex.”

RECONCILIATION OF GAAP EARNINGS TO ADJUSTED OPERATING RESULTS
		Three Months Ended								Six Months Ended
		March 31,								March 31,
(in thousands except per share amounts)		2021				2020				2021				2020
Reported GAAP Earnings		$	112,436			$	(106,068	)		$	190,210			$	(19,477	)
Items impacting comparability:
Impairment of oil and gas properties (E&P)		—				177,761				76,152				177,761
Tax impact of impairment of oil and gas properties		—				(48,503		)		(20,980		)		(48,503		)
Gain on sale of timber properties (Corporate / All Other)		—				—				(51,066		)		—
Tax impact of gain on sale of timber properties		—				—				14,069				—
Premium paid on early redemption of debt		15,715				—				15,715				—
Tax impact of premium paid on early redemption of debt		(4,321		)		—				(4,321		)		—
Deferred tax valuation allowance		—				56,770				—				56,770
Unrealized (gain) loss on other investments (Corporate / All Other)		(848		)		5,414				450				6,433
Tax impact of unrealized (gain) loss on other investments		178				(1,137		)		(94		)		(1,351		)
Adjusted Operating Results		$	123,160			$	84,237			$	220,135			$	171,633
Reported GAAP Earnings Per Share		$	1.23			$	(1.23	)		$	2.08			$	(0.23	)
Items impacting comparability:
Impairment of oil and gas properties, net of tax (E&P)		—				1.49				0.60				1.49
Gain on sale of timber properties, net of tax (Corporate / All Other)		—				—				(0.40		)		—
Premium paid on early redemption of debt, net of tax		0.12				—				0.12				—
Deferred tax valuation allowance		—				0.66				—				0.66
Unrealized (gain) loss on other investments, net of tax (Corporate / All Other)		(0.01		)		0.05				—				0.06
Adjusted Operating Results Per Share		$	1.34			$	0.97			$	2.40			$	1.98

FISCAL 2021 GUIDANCE UPDATE

National Fuel is revising its fiscal 2021 earnings guidance to reflect the results of the second fiscal quarter, along with updated commodity price and operating unit cost assumptions for the balance of the year. The Company is now projecting that earnings, excluding items impacting comparability, will be within the range of $3.85 to $4.05 per share, an increase of $0.15 per share from the midpoint of the Company’s prior guidance range.

The Company is now assuming that WTI oil prices will average $60.00 per Bbl for the remainder of the year, a $7.50 increase from the $52.50 per Bbl assumed in the previous guidance. For guidance purposes, the Company’s projections approximate the current NYMEX forward markets and consider the impact of local sales point differentials and new physical firm sales, transportation, and financial hedge contracts.

Seneca currently has firm sales contracts in place for 142 Bcf, or approximately 95% of its projected remaining fiscal 2021 Appalachian production, limiting its exposure to in-basin markets. Approximately 132 Bcf of those sales, or 88% of Seneca’s expected remaining Appalachian production, are either matched by a financial hedge, including a combination of swaps and no-cost collars, or were entered into at a fixed price. Additionally, Seneca has financial hedges in place for 786 Mbbl, or approximately 72%, of its expected remaining oil production for the fiscal year.

The Company’s other guidance assumptions remain largely unchanged from the previous guidance. Additional details on the Company's updated forecast assumptions and business segment guidance for fiscal 2021 are outlined in the table on page 7.

DISCUSSION OF SECOND QUARTER RESULTS BY SEGMENT

The following earnings discussion of each operating segment for the quarter ended March 31, 2021 is summarized in a tabular form on pages 8 and 9 of this report (earnings drivers for the six months ended March 31, 2021 are summarized on pages 10 and 11). It may be helpful to refer to those tables while reviewing this discussion.

Note that management defines Adjusted Operating Results as reported GAAP earnings adjusted for items impacting comparability, and Adjusted EBITDA as reported GAAP earnings before the following items: interest expense, income taxes, depreciation, depletion and amortization, other income and deductions, impairments, and other items reflected in operating income that impact comparability.

Upstream Business

Exploration and Production Segment

The Exploration and Production segment operations are carried out by Seneca Resources Company, LLC ("Seneca"). Seneca explores for, develops and produces natural gas and oil reserves, primarily in Pennsylvania and California.

	Three Months Ended
	March 31,
(in thousands)	2021				2020				Variance
GAAP Earnings	$	36,822			$	(175,275	)		$	212,097
Premium paid on early redemption of debt, net of tax	10,710				—				10,710
Impairment of oil and gas properties, net of tax	—				129,258				(129,258		)
Deferred tax valuation allowance	—				60,463				(60,463		)
Adjusted Operating Results	$	47,532			$	14,446			$	33,086
Adjusted EBITDA	$	127,146			$	79,846			$	47,300

Seneca’s second quarter GAAP earnings increased $212.1 million versus the prior year. This was primarily attributable to the non-recurrence of two items from the prior year's second quarter, including a non-cash ceiling test impairment charge of $129.3 million (after-tax) as well as a $60.5 million state income tax valuation allowance. Excluding these items noted above, as well as a loss of $14.8 million ($10.7 million after-tax) recognized on the early redemption of long-term debt for Seneca's share of a premium paid by the Company to redeem $500 million of the Company's 4.9% notes that were scheduled to mature in December 2021, Seneca’s second quarter earnings increased $33.1 million.

Seneca produced 85.2 Bcfe during the second quarter, an increase of 25.5 Bcfe, or 43%, from the prior year. The increase was primarily driven by higher natural gas production from the Company's fourth quarter fiscal 2020 acquisition of Appalachian upstream assets, as well as production growth from Seneca's other core development areas. Net production increased 21.2 Bcf to 50.2 Bcf in the Eastern Development Area ("EDA"), primarily due to higher production from the acquisition. Net production increased 4.6 Bcf to 31.3 Bcf in Seneca’s Western Development Area ("WDA"), primarily due to the ongoing development program in the region. Oil production for the second quarter decreased 44,000 Bbls, or 7%, from the prior year primarily due to natural production declines in Seneca's Midway Sunset, Lost Hills and Pioneer development areas as a result of lower activity in response to decreased crude oil prices. These declines were partially offset by new production brought on-line in Seneca’s Coalinga and 17N development areas.

Seneca's average realized natural gas price, after the impact of hedging and transportation costs, was $2.28 per Mcf, an increase of $0.16 per Mcf from the prior year. This increase was primarily due to higher NYMEX prices and higher spot prices at local sales points in Pennsylvania. Seneca's average realized oil price, after the impact of hedging, was $57.11 per Bbl, a decrease of $1.12 per Bbl compared to the prior year.

Lease operating and transportation (“LOE”) expense increased $15.3 million primarily due to higher transportation costs in Appalachia from increased production. LOE expense includes $49.6 million in intercompany expense for gathering and compression services used to connect Seneca’s Marcellus and Utica production to sales points along interstate pipelines. DD&A expense increased $1.0 million due largely to higher natural gas production, partially offset by the impact of ceiling test impairments recorded during fiscal 2020.

On a unit of production basis, Seneca's combined general and administrative ("G&A"), LOE, other operation and maintenance ("O&M") expense, and Property, Franchise, and Other Taxes decreased $0.18 per Mcfe, or 14%, during the quarter.

Excluding the premium paid on the early redemption of long-term debt noted above, interest expense increased by $1.3 million from the prior year, primarily driven by additional long-term borrowings from the Company's long-term debt issuance in June 2020 that was used to fund a portion of the Company's Appalachian acquisition. The increase in Seneca's effective income tax rate was largely driven by an increase to a valuation allowance for deferred tax assets that was initially established in the second quarter of fiscal 2020.

Midstream Businesses

Pipeline and Storage Segment

The Pipeline and Storage segment’s operations are carried out by National Fuel Gas Supply Corporation (“Supply Corporation”) and Empire Pipeline, Inc. (“Empire”). The Pipeline and Storage segment provides natural gas transportation and storage services to affiliated and non-affiliated companies through an integrated system of pipelines and underground natural gas storage fields in western New York and Pennsylvania.

	Three Months Ended
	March 31,
(in thousands)	2021				2020				Variance
GAAP Earnings	$	24,928			$	22,087			$	2,841
Adjusted EBITDA	$	58,570			$	49,102			$	9,468

The Pipeline and Storage segment’s second quarter GAAP earnings increased $2.8 million versus the prior year primarily due to higher operating revenues and lower O&M expense, partially offset by higher DD&A expense and higher interest expense. The increase in operating revenues of $7.5 million, or 9%, was largely due to new demand charges for transportation service from the Company's Empire North expansion project, which was placed in service near the end of the fourth quarter of fiscal 2020, coupled with an increase in Supply Corporation's transportation and storage rates effective February 1, 2020, in accordance with Supply Corporation's rate case settlement. Additionally, the Company recognized increased revenue from a surcharge mechanism for power costs related to electric motor drive compression on the Empire North project, for which offsetting O&M expense was recognized during the quarter. O&M expense decreased $2.3 million primarily due to a decrease in the reserve for preliminary project costs, which was partially offset by an increase in operating costs, largely the aforementioned Empire power costs. The increase in DD&A expense of $2.4 million was primarily attributable to incremental depreciation from the Empire North expansion project combined with an increase in Supply Corporation's depreciation rates associated with its rate case settlement. The increase in interest expense of $3.4 million was primarily driven by additional long-term borrowings from the Company's long-term debt issuance in June 2020.

Gathering Segment

The Gathering segment’s operations are carried out by National Fuel Gas Midstream Company, LLC’s limited liability companies. The Gathering segment constructs, owns and operates natural gas gathering pipelines and compression facilities in the Appalachian region, which primarily delivers Seneca’s gross Appalachian production to the interstate pipeline system.

	Three Months Ended
	March 31,
(in thousands)	2021				2020				Variance
GAAP Earnings	$	20,700			$	19,898			$	802
Premium paid on early redemption of debt, net of tax	684				—				684
Deferred tax valuation allowance	—				(3,769		)		3,769
Adjusted Operating Results	$	21,384			$	16,129			$	5,255
Adjusted EBITDA	$	41,424			$	29,541			$	11,883

The Gathering segment’s second quarter GAAP earnings increased $0.8 million versus the prior year. Excluding a $3.8 million income tax benefit that was recorded as an offset to the valuation allowance recognized by the Exploration and Production segment during the prior year second quarter that did not recur in the current quarter, as well as a $0.7 million after-tax loss recognized on the early redemption of long-term debt for Midstream Company's share of a premium paid by the Company to redeem $500 million of the Company's 4.9% notes that were scheduled to mature in December 2021, the Gathering segment's earnings increased $5.3 million.

The Gathering segment's earnings increase was primarily driven by higher operating revenues, which was partially offset by higher DD&A expense, higher O&M expenses and higher interest expense. Operating revenues increased $15.0 million, or 43%, primarily due to increased gathering throughput resulting from the Company's Appalachian acquisition in the fourth quarter of fiscal 2020 and from new Marcellus and Utica wells that were brought on-line. The increase in DD&A expense of $2.8 million was primarily attributable to incremental depreciation expense related to the Company's Appalachian acquisition, as well as higher average depreciable plant in service compared to the prior year. Compression leasing expenses, as well as higher facility and personnel costs, all associated with the Appalachian acquisition, were primarily responsible for the $3.1 million increase in O&M expense. Excluding the premium paid on the early redemption of long-term debt noted above, interest expense increased by $2.1 million from the prior year, primarily driven by additional long-term borrowings from the Company's long-term debt issuance in June 2020 that was used to fund a portion of the Appalachian acquisition.

Downstream Businesses

Utility Segment

The Utility segment operations are carried out by National Fuel Gas Distribution Corporation (“Distribution”), which sells or transports natural gas to customers located in western New York and northwestern Pennsylvania.

	Three Months Ended
	March 31,
(in thousands)	2021				2020				Variance
GAAP Earnings	$	32,044			$	31,499			$	545
Adjusted EBITDA	$	73,885			$	73,192			$	693

The Utility segment’s second quarter GAAP earnings increased $0.5 million versus the prior year primarily due to higher customer margins (operating revenues less purchased gas sold), partially offset by higher O&M expense. The increase in customer margin was due primarily to higher revenues earned through the Company's system modernization tracking mechanism in its New York service territory and colder weather in Distribution's Pennsylvania service territory that resulted in an increase in customer usage. These positive items were partially offset by the impact of adjustments recorded in the prior year for certain regulatory revenue and cost recovery mechanisms that did not occur in the current year. Weather in Distribution's Pennsylvania service territory was 8% colder on average than last year. The impact of weather variations on earnings in Distribution's New York service territory is largely mitigated by that jurisdiction's weather normalization clause. The $1.8 million increase in O&M expense was primarily attributable to incremental expense recorded to increase the allowance for uncollectible accounts due to the potential for higher customer non-payment resulting from the current economic backdrop brought on by COVID-19, as well as higher personnel costs.

Corporate and All Other

The Company’s operations that are included in Corporate and All Other generated a combined net loss of $2.1 million in the current year second quarter, which was $2.2 million lower than the combined loss of $4.3 million in the prior-year second quarter. The reduction in net loss was primarily driven by unrealized gains on investment securities recognized in the current quarter compared to unrealized losses on investment securities in the prior year second quarter.

EARNINGS TELECONFERENCE

The Company will host a conference call on Friday, May 7, 2021, at 11 a.m. Eastern Time to discuss this announcement. Pre-registration is required to access the teleconference by phone in a listen-only mode by following this link: http://www.directeventreg.com/registration/event/2524688. To access the webcast, visit the Events Calendar under the News & Events page on the NFG Investor Relations website at investor.nationalfuelgas.com. A replay of the conference call will be available approximately two hours following the teleconference at the same website link and by phone (toll-free) at 800-585-8367 using conference ID number “2524688”. Both the webcast and conference call replay will be available until the close of business on Friday, May 14, 2021.

National Fuel is an integrated energy company reporting financial results for four operating segments: Exploration and Production, Pipeline and Storage, Gathering, and Utility. Additional information about National Fuel is available at www.nationalfuelgas.com.

Analyst Contact:	Kenneth E. Webster	716-857-7067
Media Contact:	Karen L. Merkel	716-857-7654

 

Certain statements contained herein, including statements identified by the use of the words “anticipates,” “estimates,” “expects,” “forecasts,” “intends,” “plans,” “predicts,” “projects,” “believes,” “seeks,” “will,” “may” and similar expressions, and statements which are other than statements of historical facts, are “forward-looking statements” as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties, which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. The Company’s expectations, beliefs and projections contained herein are expressed in good faith and are believed to have a reasonable basis, but there can be no assurance that such expectations, beliefs or projections will result or be achieved or accomplished. In addition to other factors, the following are important factors that could cause actual results to differ materially from those discussed in the forward-looking statements: the length and severity of the recent COVID-19 pandemic, including its impacts across our businesses on demand, operations, global supply chains and liquidity; changes in economic conditions, including global, national or regional recessions, and their effect on the demand for, and customers’ ability to pay for, the Company’s products and services; changes in the price of natural gas or oil; impairments under the SEC’s full cost ceiling test for natural gas and oil reserves; the creditworthiness or performance of the Company’s key suppliers, customers and counterparties; financial and economic conditions, including the availability of credit, and occurrences affecting the Company’s ability to obtain financing on acceptable terms for working capital, capital expenditures and other investments, including any downgrades in the Company’s credit ratings and changes in interest rates and other capital market conditions; changes in laws, regulations or judicial interpretations to which the Company is subject, including those involving derivatives, taxes, safety, employment, climate change, other environmental matters, real property, and exploration and production activities such as hydraulic fracturing; the Company's ability to estimate accurately the time and resources necessary to meet emissions targets; disallowance by applicable regulatory bodies of appropriate rate recovery for system modernization; moves to reduce or eliminate reliance on natural gas; delays or changes in costs or plans with respect to Company projects or related projects of other companies, including disruptions due to the COVID-19 pandemic, as well as difficulties or delays in obtaining necessary governmental approvals, permits or orders or in obtaining the cooperation of interconnecting facility operators; the Company's ability to complete planned strategic transactions; the Company's ability to successfully integrate acquired assets and achieve expected cost synergies; governmental/regulatory actions, initiatives and proceedings, including those involving rate cases (which address, among other things, target rates of return, rate design and retained natural gas), environmental/safety requirements, affiliate relationships, industry structure, and franchise renewal; changes in price differentials between similar quantities of natural gas or oil sold at different geographic locations, and the effect of such changes on commodity production, revenues and demand for pipeline transportation capacity to or from such locations; the impact of information technology disruptions, cybersecurity or data security breaches; factors affecting the Company’s ability to successfully identify, drill for and produce economically viable natural gas and oil reserves, including among others geology, lease availability, title disputes, weather conditions, shortages, delays or unavailability of equipment and services required in drilling operations, insufficient gathering, processing and transportation capacity, the need to obtain governmental approvals and permits, and compliance with environmental laws and regulations; increasing health care costs and the resulting effect on health insurance premiums and on the obligation to provide other post-retirement benefits; other changes in price differentials between similar quantities of natural gas or oil having different quality, heating value, hydrocarbon mix or delivery date; the cost and effects of legal and administrative claims against the Company or activist shareholder campaigns to effect changes at the Company; uncertainty of oil and gas reserve estimates; significant differences between the Company’s projected and actual production levels for natural gas or oil; changes in demographic patterns and weather conditions; changes in the availability, price or accounting treatment of derivative financial instruments; changes in laws, actuarial assumptions, the interest rate environment and the return on plan/trust assets related to the Company’s pension and other post-retirement benefits, which can affect future funding obligations and costs and plan liabilities; economic disruptions or uninsured losses resulting from major accidents, fires, severe weather, natural disasters, terrorist activities or acts of war; significant differences between the Company’s projected and actual capital expenditures and operating expenses; or increasing costs of insurance, changes in coverage and the ability to obtain insurance. The Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date thereof.

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

GUIDANCE SUMMARY

As discussed on page 2, the Company is revising its earnings guidance for fiscal 2021. Additional details on the Company's forecast assumptions and business segment guidance are outlined in the table below.

The revised earnings guidance range does not include the impact of certain items that impacted the comparability of earnings during the six months ended March 31, 2021, including: (1) the after-tax impairment of oil and gas properties, which reduced earnings by $0.60 per share; (2) the after-tax gain on sale of timber properties, which increased earnings by $0.40 per share; and (3) the after-tax premium paid on early redemption of debt, which reduced earnings by $0.12 per share. While the Company expects to record certain adjustments to unrealized gain or loss on investments during the six months ending September 30, 2021, the amounts of these and other potential adjustments are not reasonably determinable at this time. As such, the Company is unable to provide earnings guidance other than on a non-GAAP basis.

	Updated FY 2021 Guidance			Previous FY 2021 Guidance
Consolidated Earnings per Share, excluding items
impacting comparability	$3.85 to $4.05			$3.65 to $3.95
Consolidated Effective Tax Rate	~ 26%			~ 26%
Capital Expenditures (Millions)
Exploration and Production	$350 - $390			$350 - $390
Pipeline and Storage	$250 - $300			$250 - $300
Gathering	$30 - $40			$30 - $40
Utility	$90 - $100			$90 - $100
Consolidated Capital Expenditures	$720 - $830			$720 - $830
Exploration & Production Segment Guidance*
Commodity Price Assumptions
NYMEX natural gas price	$2.75 /MMBtu			$2.75 /MMBtu
Appalachian basin spot price	$1.90 /MMBtu			$2.05 /MMBtu
NYMEX (WTI) crude oil price	$60.00 /Bbl			$52.50 /Bbl
California oil price premium (% of WTI)	96%			96%
Production (Bcfe)
East Division - Appalachia	300 to 315			295 to 320
West Division - California	~ 15			~ 15
Total Production	315 to 330			310 to 335
E&P Operating Costs ($/Mcfe)
LOE	$0.82 - $0.84			$0.83 - $0.85
G&A	$0.20 - $0.22			$0.20 - $0.22
DD&A	$0.57 - $0.60			$0.58 - $0.62
Other Business Segment Guidance (Millions)
Gathering Segment Revenues	$185 - $200			$185 - $200
Pipeline and Storage Segment Revenues	$335 - $345			$330 - $340
* Commodity price assumptions are for the remaining 6 months of the fiscal year.

NATIONAL FUEL GAS COMPANY
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS
QUARTER ENDED MARCH 31, 2021
(Unaudited)
	Upstream				Midstream								Downstream
	Exploration &				Pipeline &												Corporate /
(Thousands of Dollars)	Production				Storage				Gathering				Utility				All Other				Consolidated*
Second quarter 2020 GAAP earnings	$	(175,275	)		$	22,087			$	19,898			$	31,499			$	(4,277	)		$	(106,068	)
Items impacting comparability:
Impairment of oil and gas properties	177,761																				177,761
Tax impact of impairment of oil and gas properties	(48,503		)																		(48,503		)
Deferred tax valuation allowance	60,463								(3,769		)						76				56,770
Unrealized (gain) loss on other investments																	5,414				5,414
Tax impact of unrealized (gain) loss on other investments																	(1,137		)		(1,137		)
Second quarter 2020 adjusted operating results	14,446				22,087				16,129				31,499				76				84,237
Drivers of adjusted operating results**
Upstream Revenues
Higher (lower) natural gas production	43,199																				43,199
Higher (lower) crude oil production	(2,058		)																		(2,058		)
Higher (lower) realized natural gas prices, after hedging	10,040																				10,040
Higher (lower) realized crude oil prices, after hedging	(498		)																		(498		)
Midstream and All Other Revenues
Higher (lower) operating revenues					5,893				11,846								(670		)		17,069
Downstream Margins***
Impact of usage and weather													1,484								1,484
System modernization tracker revenues													1,562								1,562
Regulatory revenue adjustments													(1,226		)						(1,226		)
Higher (lower) energy marketing margins																	(2,328		)		(2,328		)
Operating Expenses
Lower (higher) lease operating and transportation expenses	(12,070		)																		(12,070		)
Lower (higher) operating expenses	(711		)		1,814				(2,473		)		(1,357		)		1,352				(1,375		)
Lower (higher) property, franchise and other taxes	(907		)																		(907		)
Lower (higher) depreciation / depletion	(792		)		(1,875		)		(2,225		)										(4,892		)
Other Income (Expense)
(Higher) lower other deductions					(377		)										359				(18		)
(Higher) lower interest expense	(1,017		)		(2,686		)		(1,629		)						(720		)		(6,052		)
Income Taxes
Lower (higher) income tax expense / effective tax rate	(2,447		)		157				(217		)		191				(1,074		)		(3,390		)
All other / rounding	347				(85		)		(47		)		(109		)		277				383
Second quarter 2021 adjusted operating results	47,532				24,928				21,384				32,044				(2,728		)		123,160
Items impacting comparability:
Premium paid on early redemption of debt	(14,772		)						(943		)										(15,715		)
Tax impact of premium paid on early redemption of debt	4,062								259												4,321
Unrealized gain (loss) on other investments																	848				848
Tax impact of unrealized gain (loss) on other investments																	(178		)		(178		)
Second quarter 2021 GAAP earnings	$	36,822			$	24,928			$	20,700			$	32,044			$	(2,058	)		$	112,436
* Amounts do not reflect intercompany eliminations.
** Drivers of operating results have been calculated using the 21% federal statutory rate.
*** Downstream margin defined as operating revenues less purchased gas expense.

NATIONAL FUEL GAS COMPANY
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS PER SHARE
QUARTER ENDED MARCH 31, 2021
(Unaudited)
	Upstream				Midstream								Downstream
	Exploration &				Pipeline &												Corporate /
	Production				Storage				Gathering				Utility				All Other				Consolidated*
Second quarter 2020 GAAP earnings per share	$	(2.03	)		$	0.26			$	0.23			$	0.36			$	(0.05	)		$	(1.23	)
Items impacting comparability:
Impairment of oil and gas properties, net of tax	1.49																				1.49
Deferred tax valuation allowance	0.70								(0.04		)						—				0.66
Unrealized (gain) loss on other investments, net of tax																	0.05				0.05
Earnings per share impact of diluted shares	0.01				(0.01		)														—
Second quarter 2020 adjusted operating results per share	0.17				0.25				0.19				0.36				—				0.97
Drivers of adjusted operating results**
Upstream Revenues
Higher (lower) natural gas production	0.47																				0.47
Higher (lower) crude oil production	(0.02		)																		(0.02		)
Higher (lower) realized natural gas prices, after hedging	0.11																				0.11
Higher (lower) realized crude oil prices, after hedging	(0.01		)																		(0.01		)
Midstream and All Other Revenues
Higher (lower) operating revenues					0.06				0.13								(0.01		)		0.18
Downstream Margins***
Impact of usage and weather													0.02								0.02
System modernization tracker revenues													0.02								0.02
Regulatory revenue adjustments													(0.01		)						(0.01		)
Higher (lower) energy marketing margins																	(0.03		)		(0.03		)
Operating Expenses
Lower (higher) lease operating and transportation expenses	(0.13		)																		(0.13		)
Lower (higher) operating expenses	(0.01		)		0.02				(0.03		)		(0.01		)		0.01				(0.02		)
Lower (higher) property, franchise and other taxes	(0.01		)																		(0.01		)
Lower (higher) depreciation / depletion	(0.01		)		(0.02		)		(0.02		)										(0.05		)
Other Income (Expense)
(Higher) lower other deductions					—												—				—
(Higher) lower interest expense	(0.01		)		(0.03		)		(0.02		)						(0.01		)		(0.07		)
Income Taxes
Lower (higher) income tax expense / effective tax rate	(0.03		)		—				—				—				(0.01		)		(0.04		)
Impact of additional shares	(0.01		)		(0.01		)		(0.01		)		(0.02		)		—				(0.05		)
All other / rounding	0.01				—				(0.01		)		(0.01		)		0.02				0.01
Second quarter 2021 adjusted operating results per share	0.52				0.27				0.23				0.35				(0.03		)		1.34
Items impacting comparability:
Premium paid on early redemption of debt, net of tax	(0.12		)						—												(0.12		)
Unrealized gain (loss) on other investments, net of tax																	0.01				0.01
Second quarter 2021 GAAP earnings per share	$	0.40			$	0.27			$	0.23			$	0.35			$	(0.02	)		$	1.23
* Amounts do not reflect intercompany eliminations.
** Drivers of operating results have been calculated using the 21% federal statutory rate.
*** Downstream margin defined as operating revenues less purchased gas expense.

NATIONAL FUEL GAS COMPANY
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS
SIX MONTHS ENDED MARCH 31, 2021
(Unaudited)
	Upstream				Midstream								Downstream
	Exploration &				Pipeline &												Corporate /
(Thousands of Dollars)	Production				Storage				Gathering				Utility				All Other					Consolidated*
Six months ended March 31, 2020 GAAP earnings	$	(151,299	)		$	40,192			$	35,842			$	58,082			$	(2,294	)			$	(19,477	)
Items impacting comparability:
Impairment of oil and gas properties	177,761																					177,761
Tax impact of impairment of oil and gas properties	(48,503		)																			(48,503		)
Deferred tax valuation allowance	60,463								(3,769		)						76					56,770
Unrealized (gain) loss on other investments																	6,433					6,433
Tax impact of unrealized (gain) loss on other investments																	(1,351		)			(1,351		)
Six months ended March 31, 2020 adjusted operating results	38,422				40,192				32,073				58,082				2,864					171,633
Drivers of adjusted operating results**
Upstream Revenues
Higher (lower) natural gas production	82,667																					82,667
Higher (lower) crude oil production	(3,955		)																			(3,955		)
Higher (lower) realized natural gas prices, after hedging	(1,564		)																			(1,564		)
Higher (lower) realized crude oil prices, after hedging	(6,277		)																			(6,277		)
Midstream and All Other Revenues
Higher (lower) operating revenues					18,173				21,500								(1,123		)			38,550
Downstream Margins***
Impact of usage and weather													321									321
System modernization tracker revenues													2,481									2,481
Regulatory revenue adjustments													(1,018		)							(1,018		)
Higher (lower) energy marketing margins																	(4,668		)			(4,668		)
Operating Expenses
Lower (higher) lease operating and transportation expenses	(23,745		)																			(23,745		)
Lower (higher) operating expenses	(2,519		)		1,623				(3,943		)		(3,313		)		2,129					(6,023		)
Lower (higher) property, franchise and other taxes	(706		)																			(706		)
Lower (higher) depreciation / depletion	(1,728		)		(4,927		)		(4,411		)		(729		)							(11,795		)
Other Income (Expense)
(Higher) lower other deductions					(888		)										1,572					684
(Higher) lower interest expense	(2,149		)		(5,545		)		(3,123		)						(1,067		)			(11,884		)
Income Taxes
Lower (higher) income tax expense / effective tax rate	(5,609		)		457				(235		)		(1,167		)		1,233					(5,321		)
All other / rounding	244				27				73				424				(13		)			755
Six months ended March 31, 2021 adjusted operating results	73,081				49,112				41,934				55,081				927					220,135
Items impacting comparability:
Impairment of oil and gas properties	(76,152		)																			(76,152		)
Tax impact of impairment of oil and gas properties	20,980																					20,980
Gain on sale of timber properties																	51,066					51,066
Tax impact of gain on sale of timber properties																	(14,069		)			(14,069		)
Premium paid on early redemption of debt	(14,772		)						(943		)											(15,715		)
Tax impact of premium paid on early redemption of debt	4,062								259													4,321
Unrealized gain (loss) on other investments																	(450		)			(450		)
Tax impact of unrealized gain (loss) on other investments																	94					94
Six months ended March 31, 2021 GAAP earnings	$	7,199			$	49,112			$	41,250			$	55,081			$	37,568				$	190,210
* Amounts do not reflect intercompany eliminations.
** Operating results have been calculated using the 21% federal statutory rate.
*** Downstream margin defined as operating revenues less purchased gas expense.

NATIONAL FUEL GAS COMPANY
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS PER SHARE
SIX MONTHS ENDED MARCH 31, 2021
(Unaudited)
	Upstream				Midstream								Downstream
	Exploration &				Pipeline &												Corporate /
	Production				Storage				Gathering				Utility				All Other				Consolidated*
Six months ended March 31, 2020 GAAP earnings per share	$	(1.75	)		$	0.46			$	0.42			$	0.67			$	(0.03	)		$	(0.23	)
Items impacting comparability:
Impairment of oil and gas properties, net of tax	1.49																				1.49
Deferred tax valuation allowance	0.70								(0.04		)						—				0.66
Unrealized (gain) loss on other investments, net of tax																	0.06				0.06
Earnings per share impact of diluted shares									(0.01		)						0.01				—
Six months ended March 31, 2020 adjusted operating results per share	0.44				0.46				0.37				0.67				0.04				1.98
Drivers of adjusted operating results**
Upstream Revenues
Higher (lower) natural gas production	0.90																				0.90
Higher (lower) crude oil production	(0.04		)																		(0.04		)
Higher (lower) realized natural gas prices, after hedging	(0.02		)																		(0.02		)
Higher (lower) realized crude oil prices, after hedging	(0.07		)																		(0.07		)
Midstream and All Other Revenues
Higher (lower) operating revenues					0.20				0.23								(0.01		)		0.42
Downstream Margins***
Impact of usage and weather													—								—
System modernization tracker revenues													0.03								0.03
Regulatory revenue adjustments													(0.01		)						(0.01		)
Higher (lower) energy marketing margins																	(0.05		)		(0.05		)
Operating Expenses
Lower (higher) lease operating and transportation expenses	(0.26		)																		(0.26		)
Lower (higher) operating expenses	(0.03		)		0.02				(0.04		)		(0.04		)		0.02				(0.07		)
Lower (higher) property, franchise and other taxes	(0.01		)																		(0.01		)
Lower (higher) depreciation / depletion	(0.02		)		(0.05		)		(0.05		)		(0.01		)						(0.13		)
Other Income (Expense)
(Higher) lower other deductions					(0.01		)										0.02				0.01
(Higher) lower interest expense	(0.02		)		(0.06		)		(0.03		)						(0.01		)		(0.12		)
Income Taxes
Lower (higher) income tax expense / effective tax rate	(0.06		)		—				—				(0.01		)		0.01				(0.06		)
Impact of additional shares	(0.02		)		(0.02		)		(0.02		)		(0.04		)		—				(0.10		)
All other / rounding	0.01				—				(0.01		)		0.01				(0.01		)		—
Six months ended March 31, 2021 adjusted operating results per share	0.80				0.54				0.45				0.60				0.01				2.40
Items impacting comparability:
Impairment of oil and gas properties, net of tax	(0.60		)																		(0.60		)
Gain on sale of timber properties, net of tax																	0.40				0.40
Premium paid on early redemption of debt, net of tax	(0.12		)						—												(0.12		)
Unrealized gain (loss) on other investments, net of tax																	—				—
Six months ended March 31, 2021 GAAP earnings per share	$	0.08			$	0.54			$	0.45			$	0.60			$	0.41			$	2.08
* Amounts do not reflect intercompany eliminations.
** Operating results have been calculated using the 21% federal statutory rate.
*** Downstream margin defined as operating revenues less purchased gas expense.

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
(Thousands of Dollars, except per share amounts)
		Three Months Ended								Six Months Ended
		March 31,								March 31,
		(Unaudited)								(Unaudited)
SUMMARY OF OPERATIONS		2021				2020				2021				2020
Operating Revenues:
Utility and Energy Marketing Revenues		$	270,849			$	282,634			$	460,315			$	510,660
Exploration and Production and Other Revenues		220,281				156,542				412,316				323,735
Pipeline and Storage and Gathering Revenues		59,985				51,919				119,644				100,888
		551,115				491,095				992,275				935,283
Operating Expenses:
Purchased Gas		106,661				118,270				158,280				210,542
Operation and Maintenance:
Utility and Energy Marketing		52,058				51,725				96,944				94,981
Exploration and Production and Other		41,895				39,959				83,922				76,652
Pipeline and Storage and Gathering		28,133				27,305				56,231				53,190
Property, Franchise and Other Taxes		23,987				22,743				46,768				45,887
Depreciation, Depletion and Amortization		84,342				77,912				167,462				152,830
Impairment of Oil and Gas Producing Properties		—				177,761				76,152				177,761
		337,076				515,675				685,759				811,843
Gain on Sale of Timber Properties		—				—				51,066				—
Operating Income (Loss)		214,039				(24,580		)		357,582				123,440
Other Income (Expense):
Other Income (Deductions)		(10,875		)		(17,480		)		(13,051		)		(20,520		)
Interest Expense on Long-Term Debt		(48,820		)		(25,270		)		(81,076		)		(50,713		)
Other Interest Expense		(1,698		)		(1,892		)		(3,618		)		(3,443		)
Income (Loss) Before Income Taxes		152,646				(69,222		)		259,837				48,764
Income Tax Expense		40,210				36,846				69,627				68,241
Net Income (Loss) Available for Common Stock		$	112,436			$	(106,068	)		$	190,210			$	(19,477	)
Earnings (Loss) Per Common Share
Basic		$	1.23			$	(1.23	)		$	2.09			$	(0.23	)
Diluted		$	1.23			$	(1.23	)		$	2.08			$	(0.23	)
Weighted Average Common Shares:
Used in Basic Calculation		91,163,291				86,561,066				91,084,620				86,469,258
Used in Diluted Calculation		91,645,679				86,561,066				91,581,918				86,469,258

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
	March 31,				September 30,
(Thousands of Dollars)	2021				2020
ASSETS
Property, Plant and Equipment	$	12,648,604			$	12,351,852
Less - Accumulated Depreciation, Depletion and Amortization		6,572,534				6,353,785
Net Property, Plant and Equipment		6,076,070				5,998,067
Assets Held for Sale, Net		—				53,424
Current Assets:
Cash and Temporary Cash Investments		80,467				20,541
Receivables - Net		229,479				143,583
Unbilled Revenue		32,685				17,302
Gas Stored Underground		5,745				33,338
Materials, Supplies and Emission Allowances		52,212				51,877
Unrecovered Purchased Gas Costs		479				—
Other Current Assets		56,117				47,557
Total Current Assets		457,184				314,198
Other Assets:
Recoverable Future Taxes		117,300				118,310
Unamortized Debt Expense		11,443				12,297
Other Regulatory Assets		147,099				156,106
Deferred Charges		60,454				67,131
Other Investments		147,421				154,502
Goodwill		5,476				5,476
Prepaid Post-Retirement Benefit Costs		89,101				76,035
Fair Value of Derivative Financial Instruments		4,104				9,308
Other		—				81
Total Other Assets		582,398				599,246
Total Assets	$	7,115,652			$	6,964,935
CAPITALIZATION AND LIABILITIES
Capitalization:
Comprehensive Shareholders' Equity
Common Stock, $1 Par Value Authorized - 200,000,000 Shares; Issued and
Outstanding - 91,163,797 Shares and 90,954,696 Shares, Respectively	$	91,164			$	90,955
Paid in Capital		1,009,075				1,004,158
Earnings Reinvested in the Business		1,100,718				991,630
Accumulated Other Comprehensive Loss		(101,988	)			(114,757	)
Total Comprehensive Shareholders' Equity		2,098,969				1,971,986
Long-Term Debt, Net of Current Portion and Unamortized Discount and Debt Issuance Costs		2,627,033				2,629,576
Total Capitalization		4,726,002				4,601,562
Current and Accrued Liabilities:
Notes Payable to Banks and Commercial Paper		—				30,000
Current Portion of Long-Term Debt		—				—
Accounts Payable		107,305				134,126
Amounts Payable to Customers		19,768				10,788
Dividends Payable		40,562				40,475
Interest Payable on Long-Term Debt		17,663				27,521
Customer Advances		—				15,319
Customer Security Deposits		19,503				17,199
Other Accruals and Current Liabilities		176,940				140,176
Fair Value of Derivative Financial Instruments		21,231				43,969
Total Current and Accrued Liabilities		402,972				459,573
Deferred Credits:
Deferred Income Taxes		763,441				696,054
Taxes Refundable to Customers		355,375				357,508
Cost of Removal Regulatory Liability		237,867				230,079
Other Regulatory Liabilities		177,685				161,573
Pension and Other Post-Retirement Liabilities		118,804				127,181
Asset Retirement Obligations		192,127				192,228
Other Deferred Credits		141,379				139,177
Total Deferred Credits		1,986,678				1,903,800
Commitments and Contingencies		—				—
Total Capitalization and Liabilities	$	7,115,652			$	6,964,935

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
	Six Months Ended
	March 31,
(Thousands of Dollars)	2021				2020
Operating Activities:
Net Income (Loss) Available for Common Stock	$	190,210			$	(19,477	)
Adjustments to Reconcile Net Income (Loss) to Net Cash
Provided by Operating Activities:
Gain on Sale of Timber Properties	(51,066		)		—
Impairment of Oil and Gas Producing Properties	76,152				177,761
Depreciation, Depletion and Amortization	167,462				152,830
Deferred Income Taxes	61,408				104,883
Premium Paid on Early Redemption of Debt	15,715				—
Stock-Based Compensation	8,657				7,580
Other	6,742				9,800
Change in:
Receivables and Unbilled Revenue	(101,159		)		(58,248		)
Gas Stored Underground and Materials, Supplies and Emission Allowances	27,258				20,086
Unrecovered Purchased Gas Costs	(479		)		2,246
Other Current Assets	(8,447		)		(3,134		)
Accounts Payable	8,613				(5,465		)
Amounts Payable to Customers	8,980				13,196
Customer Advances	(15,319		)		(12,429		)
Customer Security Deposits	2,304				(1,211		)
Other Accruals and Current Liabilities	9,058				9,076
Other Assets	11,039				(10,359		)
Other Liabilities	5				3,857
Net Cash Provided by Operating Activities	$	417,133			$	390,992
Investing Activities:
Capital Expenditures	$	(338,867	)		$	(395,486	)
Net Proceeds from Sale of Timber Properties	104,582				—
Other	12,095				4,167
Net Cash Used in Investing Activities	$	(222,190	)		$	(391,319	)
Financing Activities:
Changes in Notes Payable to Banks and Commercial Paper	$	(30,000	)		$	174,800
Reduction of Long-Term Debt	(515,715		)		—
Dividends Paid on Common Stock	(81,035		)		(75,197		)
Net Proceeds From Issuance of Long-Term Debt	495,267				—
Net Repurchases of Common Stock	(3,534		)		(4,153		)
Net Cash Provided by (Used in) Financing Activities	$	(135,017	)		$	95,450
Net Increase in Cash, Cash Equivalents, and Restricted Cash	59,926				95,123
Cash, Cash Equivalents, and Restricted Cash at Beginning of Period	20,541				27,260
Cash, Cash Equivalents, and Restricted Cash at March 31	$	80,467			$	122,383

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
SEGMENT OPERATING RESULTS AND STATISTICS
(UNAUDITED)
UPSTREAM BUSINESS
	Three Months Ended												Six Months Ended
(Thousands of Dollars, except per share amounts)	March 31,												March 31,
EXPLORATION AND PRODUCTION SEGMENT	2021				2020				Variance				2021			2020				Variance
Total Operating Revenues	$	220,187			$	155,560			$	64,627			$	411,582		$	321,499			$	90,083
Operating Expenses:
Operation and Maintenance:
General and Administrative Expense	17,899				17,429				470				34,852			32,809				2,043
Lease Operating and Transportation Expense	67,008				51,730				15,278				132,588			102,531				30,057
All Other Operation and Maintenance Expense	3,515				3,084				431				7,187			6,041				1,146
Property, Franchise and Other Taxes	4,619				3,471				1,148				9,065			8,171				894
Depreciation, Depletion and Amortization	46,139				45,136				1,003				91,471			89,284				2,187
Impairment of Oil and Gas Producing Properties	—				177,761				(177,761		)		76,152			177,761				(101,609		)
	139,180				298,611				(159,431		)		351,315			416,597				(65,282		)
Operating Income (Loss)	81,007					(143,051	)		224,058				60,267				(95,098	)		155,365
Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit Costs	(286		)		(395		)		109				(570		)	(790		)		220
Interest and Other Income	67				208				(141		)		158			441				(283		)
Interest Expense on Long-Term Debt	(15,119		)		—				(15,119		)		(15,119		)	—				(15,119		)
Interest Expense	(15,103		)		(14,163		)		(940		)		(30,594		)	(28,220		)		(2,374		)
Income (Loss) Before Income Taxes	50,566				(157,401		)		207,967				14,142			(123,667		)		137,809
Income Tax Expense	13,744				17,874				(4,130		)		6,943			27,632				(20,689		)
Net Income (Loss)	$	36,822			$	(175,275	)		$	212,097			$	7,199		$	(151,299	)		$	158,498
Net Income (Loss) Per Share (Diluted)	$	0.40			$	(2.03	)		$	2.43			$	0.08		$	(1.75	)		$	1.83

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
SEGMENT OPERATING RESULTS AND STATISTICS
(UNAUDITED)
MIDSTREAM BUSINESSES
	Three Months Ended												Six Months Ended
(Thousands of Dollars, except per share amounts)	March 31,												March 31,
PIPELINE AND STORAGE SEGMENT	2021				2020				Variance				2021			2020			Variance
Revenues from External Customers	$	59,314			$	51,919			$	7,395			$	118,623		$	100,888		$	17,735
Intersegment Revenues	27,390				27,326				64				55,846			50,577			5,269
Total Operating Revenues	86,704				79,245				7,459				174,469			151,465			23,004
Operating Expenses:
Purchased Gas	216				(3		)		219				229			(10		)	239
Operation and Maintenance	19,718				22,014				(2,296		)		40,891			42,945			(2,054		)
Property, Franchise and Other Taxes	8,200				8,132				68				16,643			16,487			156
Depreciation, Depletion and Amortization	15,729				13,356				2,373				31,197			24,960			6,237
	43,863				43,499				364				88,960			84,382			4,578
Operating Income	42,841				35,746				7,095				85,509			67,083			18,426
Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit (Costs) Credit	125				(174		)		299				250			(349		)	599
Interest and Other Income	939				1,535				(596		)		1,795			3,088			(1,293		)
Interest Expense	(10,552		)		(7,152		)		(3,400		)		(21,283		)	(14,264		)	(7,019		)
Income Before Income Taxes	33,353				29,955				3,398				66,271			55,558			10,713
Income Tax Expense	8,425				7,868				557				17,159			15,366			1,793
Net Income	$	24,928			$	22,087			$	2,841			$	49,112		$	40,192		$	8,920
Net Income Per Share (Diluted)	$	0.27			$	0.26			$	0.01			$	0.54		$	0.46		$	0.08
	Three Months Ended												Six Months Ended
	March 31,												March 31,
GATHERING SEGMENT	2021				2020				Variance				2021			2020			Variance
Revenues from External Customers	$	671			$	—			$	671			$	1,021		$	—		$	1,021
Intersegment Revenues	49,591				35,267				14,324				96,249			70,055			26,194
Total Operating Revenues	50,262				35,267				14,995				97,270			70,055			27,215
Operating Expenses:
Operation and Maintenance	8,833				5,702				3,131				16,035			11,044			4,991
Property, Franchise and Other Taxes	5				24				(19		)		18			38			(20		)
Depreciation, Depletion and Amortization	8,096				5,279				2,817				16,001			10,418			5,583
	16,934				11,005				5,929				32,054			21,500			10,554
Operating Income	33,328				24,262				9,066				65,216			48,555			16,661
Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit Costs	(68		)		(71		)		3				(135		)	(143		)	8
Interest and Other Income	9				89				(80		)		243			157			86
Interest Expense on Long-Term Debt	(965		)		—				(965		)		(965		)	—			(965		)
Interest Expense	(4,201		)		(2,160		)		(2,041		)		(8,332		)	(4,379		)	(3,953		)
Income Before Income Taxes	28,103				22,120				5,983				56,027			44,190			11,837
Income Tax Expense	7,403				2,222				5,181				14,777			8,348			6,429
Net Income	$	20,700			$	19,898			$	802			$	41,250		$	35,842		$	5,408
Net Income Per Share (Diluted)	$	0.23			$	0.23			$	—			$	0.45		$	0.42		$	0.03

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
SEGMENT OPERATING RESULTS AND STATISTICS
(UNAUDITED)
DOWNSTREAM BUSINESS
	Three Months Ended												Six Months Ended
(Thousands of Dollars, except per share amounts)	March 31,												March 31,
UTILITY SEGMENT	2021				2020				Variance				2021			2020			Variance
Revenues from External Customers	$	270,784			$	250,556			$	20,228			$	459,684		$	445,465		$	14,219
Intersegment Revenues	97				3,937				(3,840		)		197			5,853			(5,656		)
Total Operating Revenues	270,881				254,493				16,388				459,881			451,318			8,563
Operating Expenses:
Purchased Gas	133,132				119,411				13,721				210,164			204,116			6,048
Operation and Maintenance	52,864				51,070				1,794				98,116			93,913			4,203
Property, Franchise and Other Taxes	11,000				10,820				180				20,748			20,634			114
Depreciation, Depletion and Amortization	14,311				13,751				560				28,305			27,382			923
	211,307				195,052				16,255				357,333			346,045			11,288
Operating Income	59,574				59,441				133				102,548			105,273			(2,725		)
Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit Costs	(12,243		)		(12,388		)		145				(18,927		)	(19,151		)	224
Interest and Other Income	443				294				149				1,181			1,245			(64		)
Interest Expense	(5,495		)		(5,516		)		21				(10,947		)	(11,190		)	243
Income Before Income Taxes	42,279				41,831				448				73,855			76,177			(2,322		)
Income Tax Expense	10,235				10,332				(97		)		18,774			18,095			679
Net Income	$	32,044			$	31,499			$	545			$	55,081		$	58,082		$	(3,001	)
Net Income Per Share (Diluted)	$	0.35			$	0.36			$	(0.01	)		$	0.60		$	0.67		$	(0.07	)

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
SEGMENT OPERATING RESULTS AND STATISTICS
(UNAUDITED)
	Three Months Ended											Six Months Ended
(Thousands of Dollars, except per share amounts)	March 31,											March 31,
ALL OTHER	2021			2020				Variance				2021			2020			Variance
Revenues from External Customers	$	64		$	32,925			$	(32,861	)		$	1,175		$	67,161		$	(65,986	)
Intersegment Revenues	1			79				(78		)		20			256			(236		)
Total Operating Revenues	65			33,004				(32,939		)		1,195			67,417			(66,222		)
Operating Expenses:
Purchased Gas	6			29,151				(29,145		)		2,293			61,184			(58,891		)
Operation and Maintenance	(81		)	1,875				(1,956		)		683			3,578			(2,895		)
Property, Franchise and Other Taxes	38			176				(138		)		47			320			(273		)
Depreciation, Depletion and Amortization	9			206				(197		)		394			408			(14		)
	(28		)	31,408				(31,436		)		3,417			65,490			(62,073		)
Gain on Sale of Timber Properties	—			—				—				51,066			—			51,066
Operating Income	93			1,596				(1,503		)		48,844			1,927			46,917
Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit Costs	(3)			(69		)		66				(7		)	(138		)	131
Interest and Other Income	41			193				(152		)		225			471			(246		)
Interest Expense	—			(24		)		24				—			(42		)	42
Income before Income Taxes	131			1,696				(1,565		)		49,062			2,218			46,844
Income Tax Expense	1,114			527				587				12,485			678			11,807
Net Income (Loss)	$	(983	)	$	1,169			$	(2,152	)		$	36,577		$	1,540		$	35,037
Net Income (Loss) Per Share (Diluted)	$	(0.01	)	$	0.01			$	(0.02	)		$	0.40		$	0.02		$	0.38
	Three Months Ended											Six Months Ended
	March 31,											March 31,
CORPORATE	2021			2020				Variance				2021			2020			Variance
Revenues from External Customers	$	95		$	135			$	(40	)		$	190		$	270		$	(80	)
Intersegment Revenues	1,027			1,094				(67		)		1,691			2,187			(496		)
Total Operating Revenues	1,122			1,229				(107		)		1,881			2,457			(576		)
Operating Expenses:
Operation and Maintenance	3,743			3,499				244				6,342			6,142			200
Property, Franchise and Other Taxes	125			120				5				247			237			10
Depreciation, Depletion and Amortization	58			184				(126		)		94			378			(284		)
	3,926			3,803				123				6,683			6,757			(74		)
Operating Loss	(2,804		)	(2,574		)		(230		)		(4,802		)	(4,300		)	(502		)
Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit Costs	(922		)	(775		)		(147		)		(1,846		)	(1,550		)	(296		)
Interest and Other Income	35,317			22,801				12,516				74,296			53,874			20,422
Interest Expense on Long-Term Debt	(32,736		)	(25,270		)		(7,466		)		(64,992		)	(50,713		)	(14,279		)
Other Interest Expense	(641		)	(1,605		)		964				(2,176		)	(3,023		)	847
Income (Loss) before Income Taxes	(1,786		)	(7,423		)		5,637				480			(5,712		)	6,192
Income Tax Expense (Benefit)	(711		)	(1,977		)		1,266				(511		)	(1,878		)	1,367
Net Income (Loss)	$	(1,075	)	$	(5,446	)		$	4,371			$	991		$	(3,834	)	$	4,825
Net Income (Loss) Per Share (Diluted)	$	(0.01	)	$	(0.06	)		$	0.05			$	0.01		$	(0.05	)	$	0.06
	Three Months Ended											Six Months Ended
	March 31,											March 31,
INTERSEGMENT ELIMINATIONS	2021			2020				Variance				2021			2020			Variance
Intersegment Revenues	$	(78,106	)	$	(67,703	)		$	(10,403	)		$	(154,003	)	$	(128,928	)	$	(25,075	)
Operating Expenses:
Purchased Gas	(26,693		)	(30,289		)		3,596				(54,406		)	(54,748		)	342
Operation and Maintenance	(51,413		)	(37,414		)		(13,999		)		(99,597		)	(74,180		)	(25,417		)
	(78,106		)	(67,703		)		(10,403		)		(154,003		)	(128,928		)	(25,075		)
Operating Income	—			—				—				—			—			—
Other Income (Expense):
Interest and Other Deductions	(34,294		)	(28,728		)		(5,566		)		(69,714		)	(57,675		)	(12,039		)
Interest Expense	34,294			28,728				5,566				69,714			57,675			12,039
Net Income	$	—		$	—			$	—			$	—		$	—		$	—
Net Income Per Share (Diluted)	$	—		$	—			$	—			$	—		$	—		$	—

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
SEGMENT INFORMATION (Continued)
(Thousands of Dollars)
	Three Months Ended												Six Months Ended
	March 31,												March 31,
	(Unaudited)												(Unaudited)
									Increase												Increase
	2021				2020				(Decrease)				2021				2020				(Decrease)
Capital Expenditures:
Exploration and Production	$	88,271		(1)	$	102,424		(3)	$	(14,153	)		$	169,610		(1)(2)	$	229,343		(3)(4)	$	(59,733	)
Pipeline and Storage	47,970			(1)	25,554			(3)	22,416				91,693			(1)(2)	82,638			(3)(4)	9,055
Gathering	11,099			(1)	15,072			(3)	(3,973		)		19,419			(1)(2)	24,910			(3)(4)	(5,491		)
Utility	24,480			(1)	19,457			(3)	5,023				41,825			(1)(2)	36,622			(3)(4)	5,203
Total Reportable Segments	171,820				162,507				9,313				322,547				373,513				(50,966		)
All Other	—				1				(1		)		—				22				(22		)
Corporate	50				134				(84		)		89				320				(231		)
Eliminations	(373		)		—				(373		)		(219		)		—				(219		)
Total Capital Expenditures	$	171,497			$	162,642			$	8,855			$	322,417			$	373,855			$	(51,438	)

(1)	Capital expenditures for the quarter and six months ended March 31, 2021, include accounts payable and accrued liabilities related to capital expenditures of $44.5 million, $16.0 million, $2.9 million, and $4.7 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts have been excluded from the Consolidated Statement of Cash Flows at March 31, 2021, since they represent non-cash investing activities at that date.
(2)	Capital expenditures for the six months ended March 31, 2021, exclude capital expenditures of $45.8 million, $17.3 million, $13.5 million and $10.7 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts were in accounts payable and accrued liabilities at September 30, 2020 and paid during the six months ended March 31, 2021. These amounts were excluded from the Consolidated Statement of Cash Flows at September 30, 2020, since they represented non-cash investing activities at that date. These amounts have been included in the Consolidated Statement of Cash Flows at March 31, 2021.
(3)	Capital expenditures for the quarter and six months ended March 31, 2020, include accounts payable and accrued liabilities related to capital expenditures of $41.2 million, $9.7 million, $4.4 million, and $4.2 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts have been excluded from the Consolidated Statement of Cash Flows at March 31, 2020, since they represent non-cash investing activities at that date.
(4)	Capital expenditures for the six months ended March 31, 2020, exclude capital expenditures of $38.0 million, $23.8 million, $6.6 million and $12.7 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts were in accounts payable and accrued liabilities at September 30, 2019 and paid during the six months ended March 31, 2020. These amounts were excluded from the Consolidated Statement of Cash Flows at September 30, 2019, since they represented non-cash investing activities at that date. These amounts have been included in the Consolidated Statement of Cash Flows at March 31, 2020.

DEGREE DAYS
							Percent Colder
							(Warmer) Than:
Three Months Ended March 31,	Normal		2021		2020		Normal (1)			Last Year (1)
Buffalo, NY	3,290		2,978		2,738		(9.5	)		8.8
Erie, PA	3,108		2,750		2,555		(11.5	)		7.6
Six Months Ended March 31,
Buffalo, NY	5,543		4,899		4,970		(11.6	)		(1.4	)
Erie, PA	5,152		4,447		4,461		(13.7	)		(0.3	)
(1) Percents compare actual 2021 degree days to normal degree days and actual 2021 degree days to actual 2020 degree days.

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
EXPLORATION AND PRODUCTION INFORMATION
		Three Months Ended											Six Months Ended
		March 31,											March 31,
									Increase												Increase
		2021				2020			(Decrease)				2021				2020				(Decrease)
Gas Production/Prices:
Production (MMcf)
Appalachia		81,446				55,638			25,808				157,115				109,922				47,193
West Coast		428				479			(51		)		869				966				(97		)
Total Production		81,874				56,117			25,757				157,984				110,888				47,096
Average Prices (Per Mcf)
Appalachia		$	2.28			$	1.77		$	0.51			$	2.23			$	1.97			$	0.26
West Coast		7.14				4.34			2.80				6.07				4.67				1.40
Weighted Average		2.31				1.80			0.51				2.25				1.99				0.26
Weighted Average after Hedging		2.28				2.12			0.16				2.21				2.22				(0.01		)
Oil Production/Prices:
Production (Thousands of Barrels)
Appalachia		1				1			—				1				2				(1		)
West Coast		561				605			(44		)		1,124				1,206				(82		)
Total Production		562				606			(44		)		1,125				1,208				(83		)
Average Prices (Per Barrel)
Appalachia		$	48.47			$	55.90		$	(7.43	)		$	43.83			$	55.48			$	(11.65	)
West Coast		59.83				49.91			9.92				51.64				56.25				(4.61		)
Weighted Average		59.82				49.92			9.90				51.63				56.25				(4.62		)
Weighted Average after Hedging		57.11				58.23			(1.12		)		53.50				60.57				(7.07		)
Total Production (MMcfe)		85,246				59,753			25,493				164,734				118,136				46,598
Selected Operating Performance Statistics:
General & Administrative Expense per Mcfe (1)		$	0.21			$	0.29		$	(0.08	)		$	0.21			$	0.28			$	(0.07	)
Lease Operating and Transportation Expense per Mcfe (1)(2)		$	0.79			$	0.87		$	(0.08	)		$	0.80			$	0.87			$	(0.07	)
Depreciation, Depletion & Amortization per Mcfe (1)		$	0.54			$	0.76		$	(0.22	)		$	0.56			$	0.76			$	(0.20	)

(1)	Refer to page 15 for the General and Administrative Expense, Lease Operating and Transportation Expense and Depreciation, Depletion, and Amortization Expense for the Exploration and Production segment.
(2)	Amounts include transportation expense of $0.57 and $0.56 per Mcfe for the three months ended March 31, 2021 and March 31, 2020, respectively. Amounts include transportation expense of $0.57 and $0.57 per Mcfe for the six months ended March 31, 2021 and March 31, 2020, respectively.

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
EXPLORATION AND PRODUCTION INFORMATION
Hedging Summary for Remaining Six Months of Fiscal 2021		Volume					Average Hedge Price
Oil Swaps
Brent		708,000		BBL		$	57.57 / BBL
NYMEX		78,000		BBL		$	51.00 / BBL
Total		786,000		BBL		$	56.91 / BBL
Gas Swaps
NYMEX		74,340,000		MMBTU		$	2.62 / MMBTU
No Cost Collars		14,100,000		MMBTU		$	2.28 / MMBTU (Floor) / $2.77 / MMBTU (Ceiling)
Fixed Price Physical Sales		47,653,084		MMBTU		$	2.26 / MMBTU
Total		136,093,084		MMBTU
Hedging Summary for Fiscal 2022		Volume					Average Hedge Price
Oil Swaps
Brent		900,000		BBL		$	56.66 / BBL
NYMEX		156,000		BBL		$	51.00 / BBL
Total		1,056,000		BBL		$	55.83 / BBL
Gas Swaps
NYMEX		144,590,000		MMBTU		$	2.66 / MMBTU
No Cost Collars		2,350,000		MMBTU		$	2.28 / MMBTU (Floor) / $2.77 / MMBTU (Ceiling)
Fixed Price Physical Sales		46,867,111		MMBTU		$	2.23 / MMBTU
Total		193,807,111		MMBTU
Hedging Summary for Fiscal 2023		Volume					Average Hedge Price
Oil Swaps
Brent		240,000		BBL		$	54.25 / BBL
Total		240,000		BBL		$	54.25 / BBL
Gas Swaps
NYMEX		24,700,000		MMBTU		$	2.55 / MMBTU
Fixed Price Physical Sales		38,408,538		MMBTU		$	2.24 / MMBTU
Total		63,108,538		MMBTU
Hedging Summary for Fiscal 2024		Volume					Average Hedge Price
Oil Swaps
Brent		120,000		BBL		$	50.30 / BBL
Total		120,000		BBL		$	50.30 / BBL
Gas Swaps
NYMEX		1,150,000		MMBTU		$	2.45 / MMBTU
Fixed Price Physical Sales		20,817,022		MMBTU		$	2.23 / MMBTU
Total		21,967,022		MMBTU
Hedging Summary for Fiscal 2025		Volume					Average Hedge Price
Oil Swaps
Brent		120,000		BBL		$	50.32 / BBL
Total		120,000		BBL		$	50.32 / BBL
Fixed Price Physical Sales		2,293,200		MMBTU		$	2.18 / MMBTU

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
Pipeline & Storage Throughput - (millions of cubic feet - MMcf)
		Three Months Ended									Six Months Ended
		March 31,									March 31,
								Increase									Increase
		2021			2020			(Decrease)			2021			2020			(Decrease)
Firm Transportation - Affiliated		43,124			42,602			522			73,088			77,269			(4,181	)
Firm Transportation - Non-Affiliated		166,372			153,197			13,175			339,436			327,178			12,258
Interruptible Transportation		435			531			(96	)		1,024			1,244			(220	)
		209,931			196,330			13,601			413,548			405,691			7,857
Gathering Volume - (MMcf)
		Three Months Ended									Six Months Ended
		March 31,									March 31,
								Increase									Increase
		2021			2020			(Decrease)			2021			2020			(Decrease)
Gathered Volume		95,121			65,134			29,987			183,466			129,526			53,940
Utility Throughput - (MMcf)
		Three Months Ended									Six Months Ended
		March 31,									March 31,
								Increase									Increase
		2021			2020			(Decrease)			2021			2020			(Decrease)
Retail Sales:
Residential Sales		29,052			26,155			2,897			47,465			45,631			1,834
Commercial Sales		4,309			4,033			276			6,836			6,846			(10	)
Industrial Sales		223			183			40			376			400			(24	)
		33,584			30,371			3,213			54,677			52,877			1,800
Transportation		24,584			25,157			(573	)		42,518			45,712			(3,194	)
		58,168			55,528			2,640			97,195			98,589			(1,394	)

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

NON-GAAP FINANCIAL MEASURES

In addition to financial measures calculated in accordance with generally accepted accounting principles (GAAP), this press release contains information regarding Adjusted Operating Results, Adjusted EBITDA and free cash flow, which are non-GAAP financial measures. The Company believes that these non-GAAP financial measures are useful to investors because they provide an alternative method for assessing the Company's ongoing operating results or liquidity and for comparing the Company’s financial performance to other companies. The Company's management uses these non-GAAP financial measures for the same purpose, and for planning and forecasting purposes. The presentation of non-GAAP financial measures is not meant to be a substitute for financial measures in accordance with GAAP.

Management defines Adjusted Operating Results as reported GAAP earnings before items impacting comparability. The following table reconciles National Fuel's reported GAAP earnings to Adjusted Operating Results for the three and six months ended March 31, 2021 and 2020:

		Three Months Ended								Six Months Ended
		March 31,								March 31,
(in thousands except per share amounts)		2021				2020				2021				2020
Reported GAAP Earnings		$	112,436			$	(106,068	)		$	190,210			$	(19,477	)
Items impacting comparability:
Impairment of oil and gas properties (E&P)		—				177,761				76,152				177,761
Tax impact of impairment of oil and gas properties		—				(48,503		)		(20,980		)		(48,503		)
Gain on sale of timber properties (Corporate/All Other)		—				—				(51,066		)		—
Tax impact of gain on sale of timber properties		—				—				14,069				—
Premium paid on early redemption of debt		15,715				—				15,715				—
Tax impact of premium paid on early redemption of debt		(4,321		)		—				(4,321		)		—
Deferred tax valuation allowance		—				56,770				—				56,770
Unrealized (gain) loss on other investments (Corporate/All Other)		(848		)		5,414				450				6,433
Tax impact of unrealized (gain) loss on other investments		178				(1,137		)		(94		)		(1,351		)
Adjusted Operating Results		$	123,160			$	84,237			$	220,135			$	171,633
Reported GAAP Earnings Per Share		$	1.23			$	(1.23	)		$	2.08			$	(0.23	)
Items impacting comparability:
Impairment of oil and gas properties, net of tax (E&P)		—				1.49				0.60				1.49
Gain on sale of timber properties, net of tax (Corporate/All Other)		—				—				(0.40		)		—
Premium paid on early redemption of debt, net of tax		0.12				—				0.12				—
Deferred tax valuation allowance		—				0.66				—				0.66
Unrealized (gain) loss on other investments, net of tax (Corporate/All Other)		(0.01		)		0.05				—				0.06
Adjusted Operating Results Per Share		$	1.34			$	0.97			$	2.40			$	1.98

Management defines Adjusted EBITDA as reported GAAP earnings before the following items: interest expense, income taxes, depreciation, depletion and amortization, other income and deductions, impairments, and other items reflected in operating income that impact comparability. The following tables reconcile National Fuel's reported GAAP earnings to Adjusted EBITDA for the three and six months ended March 31, 2021 and 2020:

		Three Months Ended								Six Months Ended
		March 31,								March 31,
(in thousands)		2021				2020				2021				2020
Reported GAAP Earnings		$	112,436			$	(106,068	)		$	190,210			$	(19,477	)
Depreciation, Depletion and Amortization		84,342				77,912				167,462				152,830
Other (Income) Deductions		10,875				17,480				13,051				20,520
Interest Expense		50,518				27,162				84,694				54,156
Income Taxes		40,210				36,846				69,627				68,241
Impairment of Oil and Gas Producing Properties		—				177,761				76,152				177,761
Gain on Sale of Timber Properties		—				—				(51,066		)		—
Adjusted EBITDA		$	298,381			$	231,093			$	550,130			$	454,031
Adjusted EBITDA by Segment
Pipeline and Storage Adjusted EBITDA		$	58,570			$	49,102			$	116,706			$	92,043
Gathering Adjusted EBITDA		41,424				29,541				81,217				58,973
Total Midstream Businesses Adjusted EBITDA		99,994				78,643				197,923				151,016
Exploration and Production Adjusted EBITDA		127,146				79,846				227,890				171,947
Utility Adjusted EBITDA		73,885				73,192				130,853				132,655
Corporate and All Other Adjusted EBITDA		(2,644		)		(588		)		(6,536		)		(1,587		)
Total Adjusted EBITDA		$	298,381			$	231,093			$	550,130			$	454,031

NATIONAL FUEL GAS COMPANY AND SUBSIDIARIES NON-GAAP FINANCIAL MEASURES SEGMENT ADJUSTED EBITDA
		Three Months Ended								Six Months Ended
		March 31,								March 31,
(in thousands)		2021				2020				2021				2020
Exploration and Production Segment
Reported GAAP Earnings		$	36,822			$	(175,275	)		$	7,199			$	(151,299	)
Depreciation, Depletion and Amortization		46,139				45,136				91,471				89,284
Other (Income) Deductions		219				187				412				349
Interest Expense		30,222				14,163				45,713				28,220
Income Taxes		13,744				17,874				6,943				27,632
Impairment of Oil and Gas Producing Properties		—				177,761				76,152				177,761
Adjusted EBITDA		$	127,146			$	79,846			$	227,890			$	171,947
Pipeline and Storage Segment
Reported GAAP Earnings		$	24,928			$	22,087			$	49,112			$	40,192
Depreciation, Depletion and Amortization		15,729				13,356				31,197				24,960
Other (Income) Deductions		(1,064		)		(1,361		)		(2,045		)		(2,739		)
Interest Expense		10,552				7,152				21,283				14,264
Income Taxes		8,425				7,868				17,159				15,366
Adjusted EBITDA		$	58,570			$	49,102			$	116,706			$	92,043
Gathering Segment
Reported GAAP Earnings		$	20,700			$	19,898			$	41,250			$	35,842
Depreciation, Depletion and Amortization		8,096				5,279				16,001				10,418
Other (Income) Deductions		59				(18		)		(108		)		(14		)
Interest Expense		5,166				2,160				9,297				4,379
Income Taxes		7,403				2,222				14,777				8,348
Adjusted EBITDA		$	41,424			$	29,541			$	81,217			$	58,973
Utility Segment
Reported GAAP Earnings		$	32,044			$	31,499			$	55,081			$	58,082
Depreciation, Depletion and Amortization		14,311				13,751				28,305				27,382
Other (Income) Deductions		11,800				12,094				17,746				17,906
Interest Expense		5,495				5,516				10,947				11,190
Income Taxes		10,235				10,332				18,774				18,095
Adjusted EBITDA		$	73,885			$	73,192			$	130,853			$	132,655
Corporate and All Other
Reported GAAP Earnings		$	(2,058	)		$	(4,277	)		$	37,568			$	(2,294	)
Depreciation, Depletion and Amortization		67				390				488				786
Gain on Sale of Timber Properties		—				—				(51,066		)		—
Other (Income) Deductions		(139		)		6,578				(2,954		)		5,018
Interest Expense		(917		)		(1,829		)		(2,546		)		(3,897		)
Income Taxes		403				(1,450		)		11,974				(1,200		)
Adjusted EBITDA		$	(2,644	)		$	(588	)		$	(6,536	)		$	(1,587	)

Management defines free cash flow as funds from operations less capital expenditures. The Company is unable to provide a reconciliation of projected free cash flow as described in this release to its comparable financial measure calculated in accordance with GAAP without unreasonable efforts. This is due to our inability to calculate the comparable GAAP projected metrics, including operating income and total production costs, given the unknown effect, timing, and potential significance of certain income statement items.