Folsom,
NJ - South Jersey Industries (NYSE: SJI)
webcasted a presentation given to industry analysts on Wednesday,
October 1, 2008 in Atlantic City, NJ. The company’s
presentation provided an update on SJI’s activities
and outlook for the future.
Key points from the presentation are as follows:
• The company reaffirmed
guidance of 6% to 10% growth in economic earnings per share
with an emphasis on achieving the higher end of the range.
• The Board of Directors will review the current dividend
payout at its November meeting. The company’s stated
goal is to increase the dividend by at least 6% to 7% annually
and to achieve a payout ratio of 50%-60%. SJI’s dividend
payout ratio is currently below 50%.
• Guest speaker Joseph Sullivan, the Business Energy
Ombudsman for the State of New Jersey Board of Public Utilities,
discussed the New Jersey Energy Master Plan and its emphasis
on distributed generation powered by natural gas. This is
expected to benefit both the regulated utility and non-utility
businesses of SJI as demand for natural gas provided by the
utility increases and opportunities to develop distributed
generation projects increase on the non-utility side.
• To support the planned growth in southern New Jersey
and the Atlantic City area, our regulated utility, South
Jersey Gas, will complete by 2010 a $40 million pipeline
improvement project. It is anticipated that the cost of this
infrastructure enhancement can be recovered through rates.
• As a result of the significant cost advantage that
natural gas provides over alternative fuels, conversion activity
in 2008 has been robust, a trend anticipated to continue
for the remainder of 2008 and 2009.
• The company remains confident, based upon public
statements made by Boyd Gaming, of the successful completion
of the Echelon Place project in Las Vegas, NV. SJI is partnering
with DCO Energy to develop a thermal energy facility to serve
the energy needs of that project. Payments will commence
in February 2011 even if the project has not yet opened.
• Atlantic City expansion
in hospitality and gaming continues. The $2.5 billion Revel
project is currently under construction with an anticipated
completion date in 2010. Our on-site energy production company,
Marina Energy, has signed a Letter of Intent (LOI) with Revel
to develop an energy facility to service the resort. Under
the LOI, Revel is paying all costs associated with construction
of the energy facility while a final Energy Services Agreement
is negotiated.
In addition, Marina Energy is well-positioned to support
the expansion of MGM at their proposed $5 billion mega-resort,
Center City East. This project is anticipated to be completed
in 2012.
• SJI’s Asset Management and Marketing business
has locked in $28.8 million of pretax profits on its transportation
and storage assets for the 2008/2009 winter season.
• Finally, the Asset Management and Marketing business
described its successful marketing and shallow well program
in Western Pennsylvania. The company also discussed its 30%
ownership interest in the deep mineral rights on 21,000 acres
in the Marcellus Shale. While the company has no plans to
develop the Marcellus Shale play opportunity directly, we
envision the monetization of the value of this asset as a
long-term lease of the mineral rights to an established E&P
company with an upfront payment and ongoing royalties.
Given the combination of robust performance from our regulated
utility, the low-risk, complementary aspect of our storage
and transportation assets and the intriguing energy project
opportunities in our non-utility businesses, SJI remains
poised to meet our stated goals of consistent, long-term
growth.
Investors are encouraged to listen to the webcast and review
the accompanying presentation. To access a replay of the
webcast simply visit the South Jersey Industries website
at http://www.sjindustries.com, click on Investors and then
on the webcast icon.
About South Jersey Industries
South Jersey Industries (NYSE: SJI) is an energy services
holding company for utility and non-regulated businesses.
A member of the KLD Global Climate 100 Index, SJI offers
solutions to global warming through renewable energy, clean
technology and efficiency. South Jersey Gas, one of the fastest
growing natural gas utilities in the nation, strongly advocates
the efficient use of energy while safely and reliably delivering
natural
gas in southern New Jersey. South Jersey Energy Solutions,
the parent of SJI’s non-regulated businesses, provides
innovative, environmentally friendly energy solutions that
help customers control energy costs. South Jersey Energy
acquires and markets natural gas and electricity for retail
customers and offers energy-related services. Marina Energy
develops and operates energy
projects including thermal facilities serving hot and chilled
water for casinos, cogeneration facilities and landfill gas-to-electricity
facilities. South Jersey Resources Group provides wholesale
commodity marketing and risk management services. South Jersey
Energy Service Plus installs, maintains and services heating,
air conditioning and water heating systems, services appliances,
installs solar systems and performs energy audits. For more
information about SJI and its subsidiaries, visit http://www.sjindustries.com.
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