| Segment Reporting Disclosure [Text Block] |
BUSINESS SEGMENT AND OTHER OPERATIONS DATA NJR organizes its businesses based on its products and services as well as regulatory environment. As a result, the Company manages the businesses through the following reportable segments and other operations: the Natural Gas Distribution segment consists of regulated energy and off-system, capacity and storage management operations; the Energy Services segment consists of unregulated wholesale energy operations; the Midstream Asset segment consists of NJR's investments in natural gas transportation and storage facilities; the Retail and Other operations consist of appliance and installation services, commercial real estate development, renewable energy and other investments and general corporate activities. During fiscal 2010, NJR entered the solar energy markets and began planning for capital investments primarily consisting of residential and commercial rooftop and ground mount solar projects. NJR expects that both the capital expenditures and earnings contributions from these investments will be significant during fiscal 2011. In anticipation of the implementation of these planned projects, effective October 1, 2010, NJR established Clean Energy Ventures as a new reportable segment. Information related to the Company's various business segments and other operations is detailed below: | | | | | | | | | | | | | | | Three Months Ended | Nine Months Ended | | June 30, | June 30, | (Thousands) | 2011 | 2010 | 2011 | 2010 | Operating revenues | | | | | Natural Gas Distribution | | | | | External customers | $ | 138,149 |
| $ | 105,130 |
| $ | 862,073 |
| $ | 794,311 |
| Intercompany | — |
| — |
| — |
| 8,047 |
| Energy Services |
|
|
|
| External customers | 498,834 |
| 364,776 |
| 1,449,252 |
| 1,193,912 |
| Intercompany | 1,579 |
| 24 |
| 55,010 |
| 13,254 |
| Clean Energy Ventures | 328 |
| — |
| 328 |
| — |
| Segment subtotal | 638,890 |
| 469,930 |
| 2,366,663 |
| 2,009,524 |
| Retail and Other | 10,951 |
| 10,058 |
| 26,903 |
| 19,803 |
| Eliminations | (1,672 | ) | (94 | ) | (55,258 | ) | (21,541 | ) | Total | $ | 648,169 |
| $ | 479,894 |
| $ | 2,338,308 |
| $ | 2,007,786 |
| Depreciation and amortization |
|
|
|
| Natural Gas Distribution | $ | 8,192 |
| $ | 7,939 |
| $ | 24,650 |
| $ | 23,321 |
| Energy Services | 15 |
| 37 |
| 46 |
| 136 |
| Midstream Assets | 1 |
| 1 |
| 4 |
| 4 |
| Clean Energy Ventures | 115 |
| — |
| 143 |
| — |
| Segment subtotal | 8,323 |
| 7,977 |
| 24,843 |
| 23,461 |
| Retail and Other | 191 |
| 159 |
| 602 |
| 475 |
| Total | $ | 8,514 |
| $ | 8,136 |
| $ | 25,445 |
| $ | 23,936 |
| Interest income (1) |
|
|
|
| Natural Gas Distribution | $ | 304 |
| $ | 608 |
| $ | 844 |
| $ | 1,508 |
| Energy Services | 1 |
| 7 |
| 9 |
| 11 |
| Midstream Assets | 225 |
| 227 |
| 677 |
| 658 |
| Segment subtotal | 530 |
| 842 |
| 1,530 |
| 2,177 |
| Retail and Other | 1 |
| (4 | ) | 2 |
| 3 |
| Eliminations | (220 | ) | (216 | ) | (658 | ) | (642 | ) | Total | $ | 311 |
| $ | 622 |
| $ | 874 |
| $ | 1,538 |
|
| | (1) | Included in other income in the Unaudited Condensed Consolidated Statement of Operations. |
| | | | | | | | | | | | | | | Three Months Ended | Nine Months Ended | | June 30, | June 30, | (Thousands) | 2011 | 2010 | 2011 | 2010 | Interest expense, net of capitalized interest | | | | | Natural Gas Distribution | $ | 3,630 |
| $ | 4,139 |
| $ | 11,454 |
| $ | 12,545 |
| Energy Services | 193 |
| 425 |
| 792 |
| 917 |
| Midstream Assets | 803 |
| 380 |
| 2,428 |
| 2,037 |
| Clean Energy Ventures | 14 |
| — |
| 21 |
| — |
| Segment subtotal | 4,640 |
| 4,944 |
| 14,695 |
| 15,499 |
| Retail and Other | 104 |
| 294 |
| 390 |
| 447 |
| Total | $ | 4,744 |
| $ | 5,238 |
| $ | 15,085 |
| $ | 15,946 |
| Income tax provision (benefit) |
|
|
|
| Natural Gas Distribution | $ | 3,283 |
| $ | 2,081 |
| $ | 44,162 |
| $ | 41,326 |
| Energy Services | 1,949 |
| (13,316 | ) | 8,632 |
| 25,506 |
| Midstream Assets | 1,281 |
| 1,173 |
| 3,951 |
| 3,073 |
| Clean Energy Ventures | (898 | ) | — |
| (7,608 | ) | — |
| Segment subtotal | 5,615 |
| (10,062 | ) | 49,137 |
| 69,905 |
| Retail and Other | 605 |
| 269 |
| (439 | ) | (1,751 | ) | Eliminations | (23 | ) | (762 | ) | (36 | ) | (88 | ) | Total | $ | 6,197 |
| $ | (10,555 | ) | $ | 48,662 |
| $ | 68,066 |
| Equity in earnings of affiliates |
|
|
|
| Midstream Assets | $ | 3,891 |
| $ | 2,538 |
| $ | 11,871 |
| $ | 10,261 |
| Segment subtotal | 3,891 |
| 2,538 |
| 11,871 |
| 10,261 |
| Eliminations | (934 | ) | (557 | ) | (2,387 | ) | (2,376 | ) | Total | $ | 2,957 |
| $ | 1,981 |
| $ | 9,484 |
| $ | 7,885 |
| Net financial earnings (loss) |
|
|
|
| Natural Gas Distribution | $ | 5,979 |
| $ | 6,109 |
| $ | 74,375 |
| $ | 70,087 |
| Energy Services | 213 |
| 3,336 |
| 19,381 |
| 29,347 |
| Midstream Assets | 1,847 |
| 1,828 |
| 5,705 |
| 5,218 |
| Clean Energy Ventures | 259 |
| — |
| 5,484 |
| — |
| Segment subtotal | 8,298 |
| 11,273 |
| 104,945 |
| 104,652 |
| Retail and Other | 1,401 |
| 314 |
| 913 |
| (1,641 | ) | Total | $ | 9,699 |
| $ | 11,587 |
| $ | 105,858 |
| $ | 103,011 |
| Capital expenditures |
|
|
|
| Natural Gas Distribution | $ | 30,783 |
| $ | 23,778 |
| $ | 77,969 |
| $ | 55,948 |
| Clean Energy Ventures | 7,040 |
| — |
| 16,977 |
| — |
| Segment subtotal | 37,823 |
| 23,778 |
| 94,946 |
| 55,948 |
| Retail and Other | 1,012 |
| 367 |
| 2,975 |
| 460 |
| Total | $ | 38,835 |
| $ | 24,145 |
| $ | 97,921 |
| $ | 56,408 |
| Investments in equity method investees |
|
|
|
| Midstream Assets | $ | — |
| $ | — |
| $ | — |
| $ | 4,300 |
| Total | $ | — |
| $ | — |
| $ | — |
| $ | 4,300 |
|
The chief operating decision maker of the Company is the Chief Executive Officer (CEO). The CEO uses net financial earnings as a measure of profit or loss in measuring the results of the Company's segments and operations. A reconciliation of consolidated net financial earnings to consolidated net income is as follows: | | | | | | | | | | | | | | | Three Months Ended | Nine Months Ended | | June 30, | June 30, | (Thousands) | 2011 | 2010 | 2011 | 2010 | Consolidated net financial earnings | $ | 9,699 |
| $ | 11,587 |
| $ | 105,858 |
| $ | 103,011 |
| Less: |
|
|
|
| Unrealized (gain) loss from derivative instruments and related transactions, net of taxes (1) | (2,875 | ) | 15,886 |
| 33,835 |
| 3,936 |
| Effects of economic hedging related to natural gas inventory, net of taxes | (7,800 | ) | 5,878 |
| (36,787 | ) | (16,867 | ) | Consolidated net income (loss) | $ | 20,374 |
| $ | (10,177 | ) | $ | 108,810 |
| $ | 115,942 |
|
| | (1) | Excludes unrealized losses (gains) related to an intercompany transaction between NJNG and NJRES that have been eliminated in consolidation of $42,000 and $16,000 for the three months ended and $74,000 and $144,000 for the nine months ended June 30, 2011 and 2010, respectively. |
The Company uses derivative instruments as economic hedges of purchases and sales of physical gas inventory. For GAAP purposes, these derivatives are recorded at fair value and related changes in fair value are included in reported earnings. Revenues and cost of gas related to physical gas flow is recognized as the gas is delivered to customers. Consequently, there is a mismatch in the timing of earnings recognition between the economic hedges and physical gas flows. Timing differences occur in two ways:
| | • | Unrealized gains and losses on derivatives are recognized in reported earnings in periods prior to physical gas inventory flows; and |
| | • | Unrealized gains and losses of prior periods are reclassified as realized gains and losses when derivatives are settled in the same period as physical gas inventory movements occur. |
Net financial earnings is a measure of the earnings based on eliminating these timing differences, to effectively match the earnings effects of the economic hedges with the physical sale of gas. Consequently, to reconcile between GAAP and net financial earnings, current period unrealized gains and losses on the derivatives are excluded from net financial earnings as a reconciling item. Additionally, realized derivative gains and losses are also included in current period net income, however net financial earnings include only realized gains and losses related to natural gas sold out of inventory, effectively matching the full earnings effects of the derivatives with realized margins on physical gas flows.
The Company's assets for the various business segments and business operations are detailed below: | | | | | | | | (Thousands) | June 30, 2011 | September 30, 2010 | Assets at end of period: |
|
| Natural Gas Distribution | $ | 1,906,403 |
| $ | 1,904,545 |
| Energy Services | 442,980 |
| 432,380 |
| Midstream Assets | 162,516 |
| 159,882 |
| Clean Energy Ventures | 17,728 |
| — |
| Segment subtotal | 2,529,627 |
| 2,496,807 |
| Retail and Other | 72,598 |
| 85,864 |
| Intercompany assets (1) | (28,269 | ) | (19,538 | ) | Total | $ | 2,573,956 |
| $ | 2,563,133 |
|
| | (1) | Consists of transactions between subsidiaries that are eliminated and reclassified in consolidation. |
|