8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

November 4, 2019

Date of Report (Date of earliest event reported)

Commission file number 1-38681 Commission file number 1-15973

NORTHWEST NATURAL HOLDING COMPANY		NORTHWEST NATURAL GAS COMPANY
(Exact name of registrant as specified in its charter)		(Exact name of registrant as specified in its charter)
Oregon	82-4710680	Oregon	93-0256722
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)	(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

220 N.W. Second Avenue				220 N.W. Second Avenue
Portland	,	Oregon	97209	Portland	,	Oregon	97209
(Address of principal executive offices)			(Zip Code)	(Address of principal executive offices)			(Zip Code)

Registrant’s telephone number: (503) 226-4211 Registrant’s telephone number: (503) 226-4211

Securities registered pursuant to Section 12(b) of the Act:
Registrant	Title of each class	Trading Symbol	Name of each exchange on which registered
Northwest Natural Holding Company	Common Stock	NWN	New York Stock Exchange
Northwest Natural Gas Company	None

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Northwest Natural Holding Company	Emerging growth company	☐
Northwest Natural Gas Company	Emerging growth company	☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.		☐

Item 2.02 Results of Operation and Financial Condition

On November 4, 2019, Northwest Natural Holding Company (NW Holdings) issued a press release announcing its earnings for the quarter ended September 30, 2019. A copy of the press release is attached as Exhibit 99.1.

The information contained in this Item 2.02 and in the accompanying exhibit shall not be incorporated by reference into any filing of NW Holdings or Northwest Natural Gas Company (NW Natural), whether made before or after the date hereof, regardless of any general incorporation language in such filing, unless expressly incorporated by specific reference to such filing. The information in this Item 2.02, including the exhibit hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended.

Forward-Looking Statements

This report, and other presentations made by NW Holdings from time to time, may contain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as "anticipates," "assumes," "intends," "plans," "seeks," "believes," "estimates," "expects" and similar references to future periods. Examples of forward-looking statements include, but are not limited to, statements regarding the following: plans, objectives, assumptions, estimates, timing, goals, strategies, future events, investments, capital expenditures, targeted capital structure, risks, risk profile, stability, acquisitions and integration thereof, dispositions and timing, completion and outcomes thereof, customer and business growth, customer satisfaction ratings, weather, customer rates or rate recovery, environmental remediation cost recoveries, the water utility strategy and financial effects of the related pending water acquisitions, operating plans of third parties, financial results, including estimated income, liquidity, expenses, positions, revenues, returns, timing, and earnings and earnings guidance, dividends, performance, timing, outcome, or effects of regulatory proceedings or mechanisms or approvals, regulatory prudence reviews, anticipated regulatory actions or filings, expectations, recovery of pension expense, accounting treatment of future events, effects of changes in laws or regulations, including tax reform, and other statements that are other than statements of historical facts.

Forward-looking statements are based on current expectations and assumptions regarding its business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Actual results may differ materially from those contemplated by the forward-looking statements. You are therefore cautioned against relying on any of these forward-looking statements. They are neither statements of historical fact nor guarantees or assurances of future operational, economic or financial performance. Important factors that could cause actual results to differ materially from those in the forward-looking statements are discussed by reference to the factors described in Part I, Item 1A "Risk Factors", and Part II, Item 7 and Item 7A "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Quantitative and Qualitative Disclosure about Market Risk" in the most recent Annual Report on Form 10-K and in Part I, Items 2 and 3 "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Quantitative and Qualitative Disclosures About Market Risk", and Part II, Item 1A, "Risk Factors", in the quarterly reports filed thereafter.

All forward-looking statements made in this report and all subsequent forward-looking statements, whether written or oral and whether made by or on behalf of NW Holdings or NW Natural, are expressly qualified by these cautionary statements. Any forward-looking statement speaks only as of the date on which such statement is made, and NW Holdings and NW Natural undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law. New factors emerge from time to time and it is not possible to predict all such factors, nor can it assess the impact of each such factor or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statements.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

See Exhibit Index below.

EXHIBIT INDEX

Exhibit	Description
99.1	Press Release of Northwest Natural Holding Company issued November 4, 2019 (furnished and not filed).
104	Inline XBRL for the cover page of this Current Report on Form 8-K.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, each Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		NORTHWEST NATURAL HOLDING COMPANY
		(Registrant)
Dated:	November 4, 2019	/s/ Frank H. Burkhartsmeyer
		Senior Vice President and Chief Financial Officer
		NORTHWEST NATURAL GAS COMPANY
		(Registrant)
Dated:	November 4, 2019	/s/ Frank H. Burkhartsmeyer
		Senior Vice President and Chief Financial Officer

EX-99.1

Exhibit 99.1

For Immediate Release                                        

November 4, 2019

NW Natural Holdings Reports Third Quarter and Year-to-Date 2019 Results

PORTLAND, ORE. — Northwest Natural Holding Company, (NYSE: NWN) (NW Natural Holdings), reported financial results and highlights including:

• Reported year-to-date earnings of $0.91 per share from continuing operations and adjusted earnings¹ of $1.13 per share for 2019, compared to earnings of $1.06 per share from continuing operations for 2018

• Reported a net loss of $0.61 per share from continuing operations for the third quarter of 2019, compared to a loss of $0.39 per share for 2018. Both periods reflect the seasonality of our gas utility business with 2019 also affected by timing items related to the Oregon general rate case and tax reform

• Added more than 12,000 natural gas meters over the last 12 months equating to a 1.6% growth rate

• Ranked first in the nation for the seventh time in a decade among large gas utilities in the 2019 J.D. Power Gas Utility Residential Customer Satisfaction Study

• Received Washington general rate case order providing an estimated annual benefit of $3.8 million (after-tax)

• Signed purchase agreements for two water utilities bringing our total connections to nearly 25,000 serving about 62,000 people

• Increased dividends for the 64^th consecutive year with an annual indicated dividend rate of $1.91 per share

• Reaffirmed 2019 GAAP earnings guidance from continuing operations in the range of $2.02 to $2.22 per share. Excluding a regulatory pension disallowance, reaffirmed 2019 earnings guidance from continuing operations on a non-GAAP basis¹ in the range of $2.25 to $2.45 per share

"We continue to be well positioned to meet our 2019 and long-term objectives," said David H. Anderson, president and CEO of NW Natural Holdings. "I'm pleased with our strong year-to-date financial results, continued growth in our gas utility, and the recognition once again from customers for our exceptional service."

Anderson continued, "We are seeing good momentum in our water and wastewater utility business with plans for disciplined growth. In October, we announced our 64^th consecutive year of dividend increases. As we come to the close of our 160^th year, I'm proud to continue executing on our strategy and meet our long-standing commitments to customers and shareholders."

For the third quarter of 2019, net loss from continuing operations increased $7.4 million to $18.5 million (or $0.61 per share), compared to a net loss from continuing operations of $11.1 million (or $0.39 per share) for the same period in 2018. The third quarter reflects the seasonal nature of the gas utility's earnings and timing variances due to new rates from the Oregon general rate case being volumetrically recovered, whereas pension expenses are recognized evenly over the year, and income tax benefits associated with tax reform are recognized in alignment with pre-tax income. Net income is unaffected by these items on an annual basis.

Year-to-date net income from continuing operations decreased $3.6 million to $27.0 million (or $0.91 per share) for 2019, compared to $30.5 million (or $1.06 per share) for the same period in 2018. Excluding a regulatory pension disallowance, on a non-GAAP basis¹ adjusted year-to-date net income from continuing operations for 2019 was $33.6 million (or $1.13 per share) or an increase of $3.0 million compared to net income from continuing operations for the same period in 2018. Results reflected higher margin from new natural gas rates in Oregon and customer growth, partially offset by higher operations and maintenance expense, higher depreciation and interest expense, and lower other income.

__________

1     Adjusted 2019 metrics are non-GAAP financial measures and exclude the regulatory pension disallowance of $10.5 million pre-tax or $6.6 million and $0.22 cents

per share after-tax. See "Year-To-Date Results", "2019 Earnings Guidance", and "Reconciliation to GAAP" for additional information.

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KEY INITIATIVES

Washington General Rate Case

On Oct. 21, 2019, the Washington Utilities and Transportation Commission (WUTC) issued an order approving the all-party settlement in NW Natural's general rate case, increasing the utility's revenue requirement by $5.1 million (or $3.8 million after-tax). Approximately 10% of NW Natural’s revenues are derived from its Washington customers.

The order also approved a capital structure of 50% long-term debt, 1% short-term debt, and 49% common equity; a return on equity of 9.4%; cost of capital of 7.161%; and rate base of $173.7 million or an increase of $45.9 million since the last rate case.

The order also addresses how net benefits from the Tax Cuts and Jobs Act (TCJA) will be returned to customers. In the first year, customers will experience an initial rate reduction of $2.6 million and ongoing annual rate reductions are estimated to be $0.5 million thereafter. In addition, an environmental mechanism was approved that allows NW Natural to recover remediation costs.

New rates in Washington were effective beginning Nov. 1, 2019.

Water Utilities and Acquisitions

NW Natural Holdings' subsidiary, NW Natural Water Company, LLC (NW Natural Water), agreed in October to purchase Suncadia's water and wastewater utilities in Washington state and T&W water utility in Texas. The acquisitions are subject to customary closing conditions, including approvals by the respective Public Utility Commissions of Washington and Texas and are expected to close in 2020. Upon closing all outstanding transactions, NW Natural Water expects to serve about 62,000 people through nearly 25,000 connections and have invested nearly $110 million in the water sector.

Aggregate acquisitions are projected to be accretive to NW Natural Holdings’ earnings per share in the first full year of operations. While ongoing operations are not expected to have an immediately material impact on earnings, the acquisitions mark the Company's continued commitment to building a water platform that provides investors with a risk profile similar to NW Natural's regulated gas utility.

THIRD QUARTER RESULTS

The following financial comparisons are between results for the third quarter of 2019 and 2018 with individual year-over-year drivers below presented on an after-tax basis using a statutory tax rate of 26.5% unless otherwise noted.

NW Natural Holdings' third quarter results are summarized by business segment in the table below:

	Three Months Ended September 30,
	2019						2018						Change
In thousands, except per share data	Amount			Per Share			Amount			Per Share			Amount			Per Share
Net income from continuing operations:
Natural Gas Distribution segment	$	(19,570	)	$	(0.64	)	$	(11,983	)	$	(0.42	)	$	(7,587	)	$	(0.22	)
Other	1,064			0.03			839			0.03			225			—
Consolidated	$	(18,506	)	$	(0.61	)	$	(11,144	)	$	(0.39	)	$	(7,362	)	$	(0.22	)
Diluted Shares				30,429						28,815						1,614

Natural Gas Distribution Segment

Natural Gas Distribution net loss was $19.6 million (or $0.64 per share) for 2019, compared to a net loss of $12.0 million (or $0.42 per share) for 2018. The net loss increased $7.6 million reflecting the seasonal nature of the gas utility's earnings and timing variances due to new rates from the Oregon general rate case being volumetrically recovered, whereas pension expenses are recognized evenly over the year, and income tax benefits associated with tax reform are recognized in alignment with pre-tax income. Net income is unaffected by these items on an annual basis.

Margin increased $0.7 million largely due to higher rates from the Oregon general rate case, revenue from storage services at our North Mist facility that commenced operations in May 2019, as well as customer growth of 1.6% over the

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last 12 months. This was offset by an adjustment to our tax reform deferral estimate in the third quarter of 2018 that was not repeated in 2019.

Operations and maintenance and other expense, net increased $3.6 million primarily due to higher pension expense in 2019. While pension costs are recovered on an annual basis through customer rates, there are timing differences on a quarterly basis as costs are recovered volumetrically in rates while corresponding expenses are incurred evenly throughout the year. In addition, other expense, net increased as the North Mist expansion project was completed resulting in lower allowance for funds used during construction (AFUDC).

Depreciation and interest expense combined increased $2.4 million related to higher property, plant, and equipment as we continue to invest in our natural gas utility system and facilities and have higher long-term debt balances to support these investments.

Income tax benefits declined $2.1 million as a result of returning deferred tax reform benefits to Oregon customers within volumetric base rates with corresponding deferred tax reform benefits recognized in income tax expense in alignment with pre-tax income.

YEAR-TO-DATE RESULTS

The following financial comparisons are between the first nine months of 2019 and the same period in 2018 with individual year-over-year drivers below presented on an after-tax basis using a statutory tax rate of 26.5% unless otherwise noted. Non-GAAP financial measures exclude the effects of the regulatory pension disallowance in 2019 as these adjusted metrics provide a clearer view of operations, reflect how Management views financial results, and provide comparability to prior year results. See "Reconciliation to GAAP" for a detailed reconciliation of adjusted amounts.

NW Natural Holdings' year-to-date results are summarized by business segment in the table below:

	Nine Months Ended September 30,
	2019				2018				Change
In thousands, except per share data	Amount		Per Share		Amount		Per Share		Amount			Per Share
Net income from continuing operations:
Natural Gas Distribution segment	$	22,848	$	0.77	$	24,930	$	0.86	$	(2,082	)	$	(0.09	)
Regulatory pension disallowance, net	6,588		0.22		—		—		6,588			0.22
Adjusted Natural Gas Distribution segment1	29,436		0.99		24,930		0.86		4,506			0.13
Other	4,115		0.14		5,598		0.20		(1,483		)	(0.06		)
Consolidated	$	26,963	$	0.91	$	30,528	$	1.06	$	(3,565	)	$	(0.15	)
Adjusted Consolidated1	33,551		1.13		30,528		1.06		3,023			0.07
Diluted Shares			29,628				28,846					782

1 The 2019 adjusted natural gas distribution segment and adjusted consolidated net income from continuing operations are non-GAAP financial measures and exclude the effects of a regulatory disallowance of NW Natural's pension balancing account of $6.6 million after-tax (or $10.5 million pre-tax). See "Reconciliation to GAAP" for additional information.

Natural Gas Distribution Segment

Natural Gas Distribution segment net income decreased $2.1 million (or $0.09 per share). Results were affected by a $6.6 million after-tax disallowance of costs in the pension balancing account as ordered in the Oregon general rate case in March 2019. Excluding the effects of this disallowance, net income increased $4.5 million reflecting higher rates under the Oregon general rate case and customer growth, partially offset by higher operations and maintenance expense and a decline in other income.

Margin increased $23.6 million largely due to higher rates in Oregon as well as customer growth of 1.6% over the last 12 months, which collectively contributed $5.3 million. The North Mist expansion began providing storage services in May 2019 and contributed $5.3 million. Colder weather early in 2019 along with higher fee revenue from interruptible customers as a result of system restrictions contributed $3.3 million net of losses from the gas cost incentive sharing mechanism. Finally, as a result of the Oregon general rate case and order related to pensions, margin increased $10.6

3

million with no significant effect on net income as offsetting adjustments were recognized through expenses and income taxes.

Operations and maintenance expense increased $8.9 million reflecting $2.8 million of expense related to the disallowance of costs in the pension balancing account. In addition, as a result of the Oregon rate case, $5.5 million of costs were recognized with no significant effect on net income due to offsetting adjustments in margin and income taxes.

Depreciation expense increased $2.7 million related to higher property, plant, and equipment as we continue to invest in our natural gas utility system and facilities.

Other income, net decreased $14.9 million primarily due to $4.9 million of expense related to the disallowance of costs in the pension balancing account and $10.0 million of higher pension expense as we began collecting Oregon pension expenses through rates beginning Nov. 1, 2018 as well as implementing the Oregon rate case order. These costs had no significant effect on net income due to offsetting adjustments in margin and income taxes. As a result of beginning collections of the pension balancing account, $3.2 million of regulatory interest income was recognized related to the equity interest component of financing costs on the pension balancing account. Other income declined $2.5 million as a result of the completion of the North Mist expansion and recording lower AFUDC.

Interest expense increased $3.0 million primarily from higher long-term debt balances and higher commercial paper balances in the first half of 2019.

Tax expense reflected a $3.7 million benefit related to implementing the March order in the Oregon general rate case; however, as this offset higher expense, there was no significant resulting effect on net income.

Other

Other net income decreased $1.5 million (or $0.06 per share) reflecting lower asset management revenues from our Mist gas storage facility and non-operating expenses associated with developing the water business.

BALANCE SHEET AND CASH FLOWS

During the first nine months of 2019, the Company generated $155.3 million in operating cash flow and invested $160.8 million of capital expenditures in our natural gas distribution segment to support growth, safety, and technology and facility upgrades and $56.2 million for water acquisitions. Cash provided by financing activities was $67.9 million for the first nine months of 2019 or an increase of $38.8 million compared to the same period in 2018. The increase was primarily due to issuing $175 million of long-term debt and 1.4 million shares of NW Natural Holdings common stock in June 2019, partially offset by repayments of long- and short-term debt.

The Company continues to expect capital expenditures for 2019 to be in the range of $230 to $270 million to support gas utility customer growth and safety and reliability, as well as several projects.

2019 EARNINGS GUIDANCE

On March 1, 2019, NW Natural Holdings initiated 2019 earnings guidance from continuing operations in the range of $2.25 to $2.45 per share. As previously disclosed, this range did not incorporate a potential regulatory disallowance from an Oregon all-party settlement. On March 25, 2019, the OPUC issued an order requiring NW Natural to forego $10.5 million ($6.6 million after-tax or $0.22 per share) of costs associated with its pension balancing account. As a result of the disallowance, NW Natural Holdings' 2019 GAAP earnings guidance from continuing operations is expected to range from $2.02 to $2.22 per share. Excluding the pension disallowance on a non-GAAP basis, 2019 earnings guidance from continuing operations is expected to range from $2.25 to $2.45 per share.

This guidance assumes continued customer growth, average weather conditions, and no significant changes in prevailing regulatory policies, mechanisms, or outcomes, or significant laws or regulations. The expected sale of Gill Ranch and the related gain, and any operating results associated with it, are not included in this guidance range, as they are, and are expected to continue to be, reported as Discontinued Operations.

DIVIDEND DECLARED

In October 2019, NW Natural Holdings' Board of Directors declared a quarterly dividend of 47.75 cents per share on NW Natural Holdings' common stock. The dividend is payable on November 15, 2019 to shareholders of record on October 31, 2019, reflecting an annual indicated dividend rate of $1.91 per share.

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CONFERENCE CALL AND WEBCAST

As previously announced, NW Natural Holdings will host a conference call and webcast today to discuss its third quarter2019 financial and operating results.

Date and Time:	Tuesday, November 5 8 a.m. PT (11 a.m. ET)
Phone Numbers:	United States: 1-866-267-6789 Canada: 1-855-669-9657 International: 1-412-902-4110

The call will also be webcast in a listen-only format for the media and general public and can be accessed at nwnaturalholdings.com. A replay of the conference call will be available on our website and by dialing 1-877-344-7529 (U.S.), 1-855-669-9658 (Canada), and 1-412-317-0088 (international). The replay access code is 10135561.

ABOUT NW NATURAL HOLDINGS

Northwest Natural Holding Company, (NYSE: NWN) (NW Natural Holdings), is headquartered in Portland, Oregon, and through its subsidiaries has been doing business for 160 years in the Pacific Northwest. It owns NW Natural Gas Company (NW Natural), NW Natural Water Company, LLC (NW Natural Water), and other business interests and activities.

NW Natural is a local distribution company that currently provides natural gas service to approximately 2.5 million people in more than 140 communities through more than 750,000 meters in Oregon and Southwest Washington with one of the most modern pipeline systems in the nation. NW Natural consistently leads the industry with high J.D. Power & Associates customer satisfaction scores.

NW Natural Holdings’ subsidiaries own and operate 35 Bcf of underground gas storage capacity with NW Natural operating 20 Bcf in Oregon.

NW Natural Water currently provides water distribution and wastewater services to communities throughout the Pacific Northwest and Texas. When current outstanding transactions close, NW Natural Water expects to serve approximately 62,000 people through nearly 25,000 connections. Learn more about our water business at nwnaturalwater.com.

Additional information is available at nwnaturalholdings.com.

Investor Contact:

Nikki Sparley

Phone: 503-721-2530

Email: n1s@nwnatural.com

Media Contact:

Melissa Moore

Phone: 503-220-2436

Email: msm@nwnatural.com

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Forward-Looking Statements

This report, and other presentations made by NW Holdings from time to time, may contain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as "anticipates," "assumes," "intends," "plans," "seeks," "believes," "estimates," "expects" and similar references to future periods. Examples of forward-looking statements include, but are not limited to, statements regarding the following: plans, objectives, assumptions, estimates, timing, goals, strategies, future events, investments, capital expenditures, targeted capital structure, risks, risk profile, stability, acquisitions and integration thereof, dispositions and timing, completion and outcomes thereof, customer and business growth, customer satisfaction ratings, weather, customer rates or rate recovery, environmental remediation cost recoveries, the water utility strategy and financial effects of the related pending water acquisitions, operating plans of third parties, financial results, including estimated income, liquidity, expenses, positions, revenues, returns, timing, and earnings and earnings guidance, dividends, performance, timing, outcome, or effects of regulatory proceedings or mechanisms or approvals, regulatory prudence reviews, anticipated regulatory actions or filings, expectations, recovery of pension expense, accounting treatment of future events, effects of changes in laws or regulations, including tax reform, and other statements that are other than statements of historical facts.

Forward-looking statements are based on current expectations and assumptions regarding its business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Actual results may differ materially from those contemplated by the forward-looking statements. You are therefore cautioned against relying on any of these forward-looking statements. They are neither statements of historical fact nor guarantees or assurances of future operational, economic or financial performance. Important factors that could cause actual results to differ materially from those in the forward-looking statements are discussed by reference to the factors described in Part I, Item 1A "Risk Factors", and Part II, Item 7 and Item 7A "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Quantitative and Qualitative Disclosure about Market Risk" in the most recent Annual Report on Form 10-K and in Part I, Items 2 and 3 "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Quantitative and Qualitative Disclosures About Market Risk", and Part II, Item 1A, "Risk Factors", in the quarterly reports filed thereafter.

All forward-looking statements made in this report and all subsequent forward-looking statements, whether written or oral and whether made by or on behalf of NW Holdings or NW Natural, are expressly qualified by these cautionary statements. Any forward-looking statement speaks only as of the date on which such statement is made, and NW Holdings and NW Natural undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law. New factors emerge from time to time and it is not possible to predict all such factors, nor can it assess the impact of each such factor or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statements.

Presentation of Non-GAAP Results

In addition to presenting the results of operations and earnings amounts in total, certain financial measures exclude the regulatory pension disallowance in 2019, which is a non-GAAP financial measure. The Company presents net income and EPS excluding this item along with the GAAP measures to illustrate the magnitude of this item on ongoing business and operational results. Although the excluded amount is properly included in the determination of this item under GAAP, the Company believes the amount and nature of such an item makes period-to-period comparisons of operations difficult or potentially confusing. Financial measures are expressed in cents per share as these amounts reflect factors that directly impact earnings, including income taxes. All references to EPS are on the basis of diluted shares. The Company uses such non-GAAP financial measures to analyze financial performance because the Company believes they provide useful information to investors and creditors in evaluating the Company's financial condition and results of operations.

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NORTHWEST NATURAL HOLDINGS
Consolidated Income Statement and Financial Highlights (Unaudited)
Third Quarter 2019
		Three Months Ended							Nine Months Ended							Twelve Months Ended
In thousands, except per share amounts, customer, and degree day data		September 30,							September 30,							September 30,
		2019			2018			Change	2019			2018			Change	2019			2018			Change
Operating revenues		$	90,317		$	91,239		(1)%	$	499,108		$	479,441		4%	$	725,810		$	718,065		1%
Operating expenses:
	Cost of gas	22,603			25,538			(11)	163,167			175,697			(7)	242,989			276,637			(12)
	Operations and maintenance	40,886			37,569			9	131,854			115,120			15	173,432			160,767			8
	Environmental remediation	967			1,022			(5)	7,258			7,528			(4)	10,857			11,899			(9)
	General taxes	7,993			7,589			5	24,899			24,792			—	32,279			32,008			1
	Revenue taxes	3,534			3,522			—	19,956			20,731			(4)	29,307			20,731			41
	Depreciation and amortization	23,375			21,485			9	67,334			63,507			6	88,983			84,031			6
	Other operating expenses	593			625			(5)	2,131			2,157			(1)	3,201			2,157			48
	Total operating expenses	99,951			97,350			3	416,599			409,532			2	581,048			588,230			(1)
Income (loss) from operations		(9,634		)	(6,111		)	58	82,509			69,909			18	144,762			129,835			11
Other income (expense), net		(2,267		)	(312		)	NM	(18,782		)	(1,139		)	NM	(21,244		)	(810		)	NM
Interest expense, net		10,948			9,006			22	31,807			27,051			18	41,815			36,266			15
Income (loss) before income taxes		(22,849		)	(15,429		)	48	31,920			41,719			(23)	81,703			92,759			(12)
Income tax (benefit) expense		(4,343		)	(4,285		)	1	4,957			11,191			(56)	17,957			27,743			(35)
Net income (loss) from continuing operations		(18,506		)	(11,144		)	66	26,963			30,528			(12)	63,746			65,016			(2)
Loss from discontinued operations, net of tax		(795		)	(650		)	22	(1,968		)	(1,783		)	10	(2,927		)	(126,438		)	(98)
Net income (loss)		$	(19,301	)	$	(11,794	)	64	$	24,995		$	28,745		(13)	$	60,819		$	(61,422	)	(199)
Common shares outstanding:
	Average diluted for period	30,429			28,815				29,628			28,846				29,451			28,831
	End of period	30,422			28,844				30,422			28,844				30,422			28,844
Per share of common stock information:
Diluted earnings (loss) from continuing operations		$	(0.61	)	$	(0.39	)		$	0.91		$	1.06			$	2.16		$	2.26
Diluted loss from discontinued operations, net of tax		(0.02		)	(0.02		)		(0.07		)	(0.06		)		(0.09		)	(4.39		)
Diluted earnings (loss)		(0.63		)	(0.41		)		0.84			1.00				2.07			(2.13		)
Dividends paid per share		0.4750			0.4725				1.4250			1.4175				1.9000			1.8900
Book value, end of period		27.77			25.57				27.77			25.57				27.77			25.57
Market closing price, end of period		71.34			66.90				71.34			66.90				71.34			66.90
Capital structure, end of period:
	Common stock equity	46.6		%	44.8		%		46.6		%	44.8		%		46.6		%	44.8		%
	Long-term debt	44.5			44				44.5		%	44.0		%		44.5		%	44.0		%
	Short-term debt (including current maturities of long-term debt)	8.9			11.2				8.9		%	11.2		%		8.9		%	11.2		%
	Total	100.0		%	100.0		%		100.0		%	100.0		%		100.0		%	100.0		%
Natural Gas Distribution segment operating statistics:
Meters - end of period		755,458			743,386			1.6%	755,458			743,386			1.6%	755,458			743,386			1.6%
Volumes in therms:
	Residential and commercial sales	60,427			57,368				480,987			439,024				703,126			683,444
	Industrial sales and transportation	107,596			104,730				348,821			347,420				468,441			477,390
Total volumes sold and delivered		168,023			162,098				829,808			786,444				1,171,567			1,160,834
Operating revenues:
	Residential and commercial sales	$	65,206		$	68,768			$	419,502		$	420,878			$	620,406		$	638,225
	Industrial sales and transportation	12,280			12,780				40,511			43,572				55,652			60,315
	Other distribution revenues	430			3,417				12,678			(3,144		)		15,716			(2,202		)
	Other regulated services	5,147			112				7,397			219				7,437			—
Total operating revenues		83,063			85,077				480,088			461,525				699,211			696,338
	Less: Cost of gas	22,659			25,593				163,335			175,864				243,214			277,028
	Less: Environmental remediation expense	967			1,022				7,258			7,528				10,857			11,899
	Less: Revenue taxes	3,534			3,522				19,956			20,731				29,307			26,549
Margin, net		$	55,903		$	54,940			$	289,539		$	257,402			$	415,833		$	380,862
Degree days:
	Average (25-year average)	9			10				1,646			1,637				2,723			2,705
	Actual	28			—			NM	1,638			1,449			13%	2,502			2,526			(1)%
Percent colder (warmer) than average weather		NM			NM				—		%	(11		)%		(8		)%	(7		)%
	NM = Not Meaningful calculation

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NORTHWEST NATURAL HOLDINGS
Consolidated Balance Sheets (Unaudited)	September 30,
In thousands	2019			2018
Assets:
Current assets:
Cash and cash equivalents	$	10,522		$	29,965
Accounts receivable	29,617			25,125
Accrued unbilled revenue	17,934			16,351
Allowance for uncollectible accounts	(180		)	(394		)
Regulatory assets	47,996			41,241
Derivative instruments	5,987			2,871
Inventories	41,230			53,064
Gas reserves	16,392			16,916
Other current assets	18,617			20,376
Discontinued operations current assets	14,612			12,644
Total current assets	202,727			218,159
Non-current assets:
Property, plant, and equipment	3,416,718			3,370,388
Less: Accumulated depreciation	1,027,330			996,994
Total property, plant, and equipment, net	2,389,388			2,373,394
Gas reserves	51,978			70,556
Regulatory assets	313,890			333,917
Derivative instruments	1,610			861
Other investments	63,018			65,113
Operating lease right of use asset	3,917			—
Assets under sales-type leases	147,918			—
Goodwill	49,333			6,563
Other non-current assets	27,839			12,844
Total non-current assets	3,048,891			2,863,248
Total assets	$	3,251,618		$	3,081,407
Liabilities and equity:
Current liabilities:
Short-term debt	$	65,580		$	100,500
Current maturities of long-term debt	94,671			84,940
Accounts payable	76,197			80,143
Taxes accrued	13,382			13,074
Interest accrued	10,406			9,453
Regulatory liabilities	37,573			37,504
Derivative instruments	4,156			8,828
Operating lease liabilities	3,171			—
Other current liabilities	39,873			35,497
Discontinued operations current liabilities	13,399			13,003
Total current liabilities	358,408			382,942
Long-term debt	806,014			724,654
Deferred credits and other non-current liabilities:
Deferred tax liabilities	284,625			274,315
Regulatory liabilities	615,813			606,175
Pension and other postretirement benefit liabilities	215,007			212,249
Derivative instruments	2,998			3,016
Operating lease liabilities	732			—
Other non-current liabilities	123,352			140,475
Total deferred credits and other non-current liabilities	1,242,527			1,236,230
Equity:
Common stock	556,623			455,499
Retained earnings	296,256			290,059
Accumulated other comprehensive loss	(8,210		)	(7,977		)
Total equity	844,669			737,581
Total liabilities and equity	$	3,251,618		$	3,081,407

8

NORTHWEST NATURAL HOLDINGS
Consolidated Statements of Cash Flows (Unaudited)	Nine Months Ended September 30,
In thousands	2019			2018
Operating activities:
Net income	$	24,995		$	28,745
Adjustments to reconcile net income to cash provided by operations:
Depreciation and amortization	67,334			63,507
Regulatory amortization of gas reserves	14,474			12,056
Deferred income taxes	2,471			3,954
Qualified defined benefit pension plan expense	10,464			4,450
Contributions to qualified defined benefit pension plans	(7,810		)	(11,690		)
Deferred environmental expenditures, net	(10,992		)	(10,547		)
Amortization of environmental remediation	7,258			7,528
Regulatory revenue recovery deferral from TCJA	742			6,983
Regulatory disallowance of pension costs	10,500			—
Other	9,058			1,541
Changes in assets and liabilities:
Receivables, net	80,205			83,194
Inventories	(3,293		)	(5,134		)
Income and other taxes	21,510			(5,809		)
Accounts payable	(31,767		)	(22,929		)
Interest accrued	3,100			2,680
Deferred gas costs	(47,085		)	2,372
Decoupling mechanism	11,095			2,915
Other, net	(6,713		)	(6,503		)
Discontinued operations	(255		)	1,216
Cash provided by operating activities	155,291			158,529
Investing activities:
Capital expenditures	(152,993		)	(158,795		)
Acquisitions, net of cash acquired	(56,189		)	136
Other	(15,460		)	(1,797		)
Discontinued operations	(648		)	(619		)
Cash used in investing activities	(225,290		)	(161,075		)
Financing activities:
Proceeds from stock options exercised	1,723			1,368
Proceeds from common stock issued	93,182			—
Long-term debt issued	175,000			50,000
Long-term debt retired	(10,000		)	(22,000		)
Change in short-term debt	(152,040		)	46,300
Stock purchases related to acquisitions	—			(7,951		)
Cash dividend payments on common stock	(39,605		)	(38,387		)
Other	(372		)	(291		)
Cash provided by (used in) financing activities	67,888			29,039
Increase in cash and cash equivalents	(2,111		)	26,493
Cash and cash equivalents, beginning of period	12,633			3,472
Cash and cash equivalents, end of period	$	10,522		$	29,965
Supplemental disclosure of cash flow information:
Interest paid, net of capitalization	$	27,736		$	22,821
Income taxes paid (refunded), net	(6,096		)	22,047

9

NORTHWEST NATURAL HOLDINGS
Reconciliation to GAAP (Unaudited)
Year-to-Date Results 2019
	Nine Months Ended September 30,
	2019						2018
In thousands, except per share data	Amount			Per Share			Amount		Per Share
CONSOLIDATED
GAAP net income from continuing operations	$	26,963		$	0.91		$	30,528	$	1.06
Regulatory pension disallowance	10,500			0.35			—		—
Income tax effect of regulatory disallowance1	(3,912		)	(0.13		)	—		—
Adjusted net income from continuing operations	$	33,551		$	1.13		$	30,528	$	1.06
Diluted shares				29,628					28,846
NATURAL GAS DISTRIBUTION SEGMENT
GAAP net income	$	22,848		$	0.77		$	24,930	$	0.86
Regulatory pension disallowance	10,500			0.35			—		—
Income tax effect of regulatory disallowance1	(3,912		)	(0.13		)	—		—
Adjusted net income	$	29,436		$	0.99		$	24,930	$	0.86

1 Regulatory disallowance related to the pension balancing account was recognized in the first quarter of 2019. Tax effect of adjustment was calculated using a combined federal and state statutory rate of 26.5% and reducing the disallowance by a $1.1 million deferred taxes specifically associated with the pension balancing account.

10

XML

Document and Entity Information Document	Nov. 04, 2019
Document Information [Line Items]
Entity Emerging Growth Company	false
Title of 12(b) Security	Common Stock
City Area Code	(503)
Entity Address, Address Line One	220 N.W. Second Avenue
Entity Registrant Name	NORTHWEST NATURAL HOLDING COMPANY
Document Type	8-K
Document Period End Date	Nov. 04, 2019
Entity Central Index Key	0001733998
Amendment Flag	false
Entity File Number	1-38681
Entity Incorporation, State or Country Code	OR
Entity Tax Identification Number	82-4710680
Entity Address, City or Town	Portland
Entity Address, State or Province	OR
Entity Address, Postal Zip Code	97209
Local Phone Number	226-4211
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Trading Symbol	NWN
Security Exchange Name	NYSE
Northwest Natural Gas Company [Member]
Document Information [Line Items]
Entity Emerging Growth Company	false
City Area Code	(503)
Entity Address, Address Line One	220 N.W. Second Avenue
Entity Registrant Name	NORTHWEST NATURAL GAS COMPANY
Document Type	8-K
Document Period End Date	Nov. 04, 2019
Entity Central Index Key	0000073020
Amendment Flag	false
Entity File Number	1-15973
Entity Incorporation, State or Country Code	OR
Entity Tax Identification Number	93-0256722
Entity Address, City or Town	Portland
Entity Address, State or Province	OR
Entity Address, Postal Zip Code	97209
Local Phone Number	226-4211
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false