Good morning. I am Paul Nester, President and CEO of RGC Resources. Welcome and thank you for joining us as we discuss RGC Resources’ Fourth Quarter and Fiscal 2020 Annual Results.

Joining me today are Randy Burton, our Chief Financial Officer and David Garcia, our Director of Financial Planning and Analysis, David help us with these slides and calls and we asked him to join us today. First, I would like to go over a few administrative items. We have muted all lines and ask that all participants remain muted.

After the presentation is completed, we will take questions. The link to today’s presentation is available on the investor and financial information page of our website at www.rgcresources.com. Now, let’s begin our presentation. Slide 1 contains our forward looking statements disclaimer. This presentation does have forecasts and projections.

As outlined on Slide 2, we will begin with a review of our operational and financial results for the fourth quarter and annual periods of fiscal 2020 followed by the outlook for fiscal 2021. As noted on Slide 3, our fiscal 2020 customer growth extended our annual trend of adding over 550 new customers per year since 2017 or approximately 2%.

We expect this trend to continue into fiscal 2021. As represented on Slide 4, fourth quarter volumes exceeded the prior year quarter due to increased uses of certain large industrial customers and a cooler than normal September.

As shown on Slide 5, fiscal 2020 total volumes delivered increased 5% compared to last year despite 5% overall warmer weather. The increase in commercial and industrial volumes offset the decreases in the farm classes. Moving on to Slide 6, our capital spending for fiscal 2020 was $22.9 million or $1 million ahead of the prior year.

Through the SAVE infrastructure rider we invested approximately $10.3 million to continue modernizing our system, renewing just at 9 miles of main. As we have discussed over the years, the SAVE rider mechanism continues to allow us to make our distribution system safer and more reliable in an efficient manner regulatorily speaking.

In September, the SEC approved our SAVE application for 2021. Additionally, in 2020, we invested almost $8 million in growth and expansion of our system, which included the completion of the Blue Ridge main extension project, which we have discussed on prior calls. Randy Burton, our CFO will now walk us through our earnings highlights.

Randy?.

Thanks, Paul and good morning. As indicated on Slide 7, Resources completed fiscal 2020, with EPS increasing approximately 20% over the prior year to $1.30 per diluted share. These results reflect performance improvements driven by favorable utility margins and earnings on our MVP investment. Now, let’s turn to an overview of our operating results.

To aid in this discussion, we have included our condensed consolidated statements of income on Slide 8. Let’s start with our quarter-to-quarter results. In spite of the pandemic, Roanoke Gas had another solid operating quarter with increased volumes and continued improvement in gas utility margins, net of certain non-cash expenses.

As addressed in our 10-K, gas utility margin is a non-GAAP measure defined as gas utility revenue less cost of gas. From a regulatory viewpoint and due to the strong 12-month performance, Roanoke Gas exceeded midpoint of its authorized return on equity. Consequently, we accelerated recovery of $462,000 of regulatory assets in the fourth quarter.

Additionally, as the pandemic continues to impact our customer receivables, we added approximately $190,000 in bad debt expense in the fourth quarter.

The non-cash equity earnings from RGC Midstream’s investment in the Mountain Valley pipeline increased 35% to approximately $1.3 million due to construction spending to-date, primarily due to the non-cash charges as we have discussed.

The fourth quarter had a net loss of $329,000 or $0.04 per share compared to net income of $456,000 or $0.06 per diluted share for the fourth quarter of prior year. Now, let’s review results from fiscal 2020. Operating income increased 8% to $12.5 million.

The primary drivers were the higher non-gas rates and increased transportation and interruptible volumes.

These increases were offset by higher expenses related to the fourth quarter regulatory asset acceleration, bad debt expense, accelerated vesting of restricted stock and to a lesser extent increases in professional services, repairs and maintenance, general taxes and depreciation expense.

Equity earnings on the MVP investment increased by approximately $1.8 million to $4.8 million again related to the construction spend to-date. The other income increases reflects the recognition of AFUDC by Roanoke Gas related to the two MVP interconnect projects as discussed in earlier calls.

Increased borrowings resulted in a 13% increase in interest expense. Borrowing levels increased over the same period of the prior year due to the continued funding of our MVP investment as well as the funding of Roanoke Gas’ capital projects.

The current favorable interest rate environment eased interest expense in light of these additional borrowings. Income tax expense increased due to the company’s growth in taxable income. In combination, all of these factors resulted in a $1.9 million or 21% increase in net income for fiscal 2020 as compared to fiscal 2019.

As this concludes our review of financial results, I will now hand the presentation back over to Paul..

Thank you, Randy. We did have an outstanding 2020 in fact, our sixth consecutive year of record earnings. I would like to take this opportunity to thank our customers and employees. They are the reason for this consistent success. Let’s discuss 2021 we are on Slide 9.

We plan to invest $21.1 million this fiscal year as we continue to renew, strengthen and expand the Roanoke Gas distribution system. Investment through SAVE Rider projects will lead the way.

The MVP has returned to limited construction and is still working through various permit issues the project is targeting an in-service date during the second half of calendar 2021. We look forward to the pipe going in service and providing needed additional supply to Southwest Virginia.

As we sit here today, the pandemic is still with us and as such, we wanted to give you an update on its effects to our operating conditions. As we are entering the winter heating season, it continues to create significant uncertainty. The safety of our customers and employees is still our number one Priority.

Protocols and procedures to meet that priority are still in place. As Randy discussed earlier, the primary impact to our financial statements is the increased aging of accounts receivable, which we expect will continue at least through the winter heating season as the moratorium on residential customer turnoff continues.

We are regularly analyzing our delivered volumes at the individual customer level. And finally, we are working hard at being flexible. We continue to work hard at being flexible and adaptable as conditions may change. That concludes our prepared remarks. If you have any questions, please dial #6 to unmute your line, #6 to unmute your line.

And Randy, David and I will be glad to discuss your question..

Good morning, everyone..

Good morning..

Good morning.

How are you?.

Doing well.

Yourself?.

Doing very well. Thank you. Good to hear from you..

Hey. Just actually two questions both of them on MVP. Good to hear that limited construction is back.

Any dates we should be watching in terms of court activity deadlines, etcetera here for the next couple of months?.

Yes, that’s a great question. Mike. I don’t think there are any specific dates at this point in time. There was really a flurry of activity in October and November, particularly in the Fourth Circuit Court of Appeals around the biological opinion in the Nationwide 12.

As you probably know, the Nationwide 12 Permit was in fact stayed by the court on November 9. The biological opinion was not stayed by the court that was a favorable outcome there.

So as far as we know at this point, there aren’t any hard and fast dates related to those two permits or any of the other FERC actions at the moment, certainly be glad to keep you updated as those become available..

Great.

The other questions, I know there was chatter that I guess going back maybe even to your last conference call that ConEd was planning on divesting their ownership stake, just wondering, if that has occurred yet or is that process still ongoing?.

Yes. We have not had any communication with them, Mike, in regards to that. And certainly, it would make sense to confer with them there.

As you know, last year about this time, they did publicly announced that they were exercising their right to limit their contributions, which they have been doing through 2020 and will do through the remainder of the project and that action does dilute down their ownership.

They were originally a 12.5% partner in the joint venture and over time to the completion, they will dilute down from that..

Okay. Well, that’s all I had gentlemen. And I will speak to you before the New Year. Have a great holiday season..

Thanks Mike..

Well, thank you, Mike. Likewise. Do we have any other other questions? You can dial #6 to unmute your line if you would like to ask a question? Okay. Well, if there are no more questions, this concludes our 2020 annual earnings call. We look forward to speaking with you again in 2021 to review our first quarter results. Thank you again for joining us.

And we just wish all of you to have a Merry Christmas and a Happy New Year and a safe and healthy holiday season overall. We hope you have a great Friday and a wonderful weekend. Thank you..

Thank you..