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

May 8, 2020

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.)

250 SW Taylor Street				250 SW Taylor Street
Portland	,	Oregon	97204	Portland	,	Oregon	97204
(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 May 8, 2020, Northwest Natural Holding Company (NW Holdings) issued a press release announcing its earnings for the quarter ended March 31, 2020. 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 timing, completion and integration thereof, dispositions and timing, completion and outcomes thereof, global, national and local economies, 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, availability and sources of 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, effects, extent, severity and duration of COVID-19 and resulting economic disruption, the impact of mitigating factors and other efforts to mitigate risks posed by its spread, ability of our workforce, customers or suppliers to operate or conduct business, COVID-19 expenses and cost recovery including through regulatory deferrals, impact on capital projects, governmental actions and timing thereof, including actions to reopen the economy, 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 May 8, 2020 (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:	May 8, 2020	/s/ Frank H. Burkhartsmeyer
		Senior Vice President and Chief Financial Officer
		NORTHWEST NATURAL GAS COMPANY
		(Registrant)
Dated:	May 8, 2020	/s/ Frank H. Burkhartsmeyer
		Senior Vice President and Chief Financial Officer

EX-99.1

Exhibit 99.1

For Immediate Release                                        

May 8, 2020

NW Natural Holdings Reports First Quarter2020 Results

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

• Reported first quarter 2020 earnings of $1.58 per share from continuing operations, compared to earnings of $1.50 per share and adjusted earnings¹ of $1.73 per share for the same period in 2019

• Provided customers with essential natural gas and water utility services during coronavirus pandemic (COVID-19)

• Added more than 12,400 natural gas meters over the last 12 months equating to a 1.6% growth rate

• Closed four water utility transactions in 2020 bringing our total connections to 25,000 serving about 61,000 people

• Reaffirmed 2020 GAAP earnings guidance from continuing operations in the range of $2.25 to $2.45 per share and guided toward the lower end of the range given potential effects from the COVID-19

"I want to express my deepest sympathy to those directly affected by the coronavirus pandemic, my appreciation for our health care workers on the front line of this crisis, and my gratitude to our employees for their tireless dedication to ensure our essential services are provided during these difficult times,” said David H. Anderson, president and CEO of NW Natural Holdings. "For more than 160 years we've provided critical services through both prosperous and challenging times. We're committed to doing what's needed, when it's needed most by our communities."

"We quickly mobilized our incident command and business continuity protocols in March to ensure safe and uninterrupted service to our customers amid the pandemic," continued Anderson. "NW Natural initiated a special COVID-19 giving campaign aimed at assisting the most vulnerable members of our communities, which will supplement the Company's local, state, and federal gas assistance programs that also help customers struggling financially. We've also filed a request with regulators to provide customers with their annual June bill credit related to our revenue sharing mechanism, which this year equates to a 30% reduction in an average monthly residential bill. During March, we also rapidly secured financing to provide our business with ample cash liquidity. Each and every day we care about the safety and wellbeing of our customers and employees, and we're taking extra precautions to protect our employees, prevent the spread of the virus, and assist our communities."

For the first quarter of 2020, net income from continuing operations increased $4.9 million to $48.3 million (or $1.58 per share), compared to net income from continuing operations of $43.4 million (or $1.50 per share) for the same period in 2019. Results for 2019, included a regulatory pension disallowance of $10.5 million (or $6.6 million after-tax and $0.23 per share). Excluding this disallowance on a non-GAAP basis¹, adjusted net income from continuing operations for 2019 was $50.0 million (or $1.73 per share) resulting in a $1.7 million decline year over year. Results reflected higher margin from new natural gas rates in Washington, customer growth, and revenues from our North Mist gas storage facility as well as contributions from water utilities acquired since the prior period. Offsetting these drivers were higher depreciation expense, lower interest income on regulatory deferrals, and a decline in asset management revenues.

__________

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

$0.23 cents per share after-tax). See "Reconciliation to GAAP" for additional information.

1

KEY INITIATIVES

Coronavirus (COVID-19) Response

Since the outbreak of COVID-19, NW Natural Holdings has executed on business continuity plans with a focus on the safety of our 1,200 employees and the 2.5 million people, business partners and communities we serve. We've implemented work-from-home plans for employees wherever possible. For employees whose role requires them to work in the field, we are following CDC, OHSA, and state specific guidance, have limited non-essential in-home service visits such as routine inspections, and have enacted social distancing and sanitizing protocols to prevent the spread of this disease and keep our employees and customers safe.

Our water and natural gas utility businesses continue to serve our customers without interruption. We voluntarily andtemporarily stopped charging late fees and disconnecting customers for nonpayment beginning March 16, 2020. In addition, we've filed with regulators to return a record amount, approximately $17 million, to our Oregon natural gas customers related to our sharing mechanism on their June bills. In order to strengthen our liquidity during the COVID pandemic, we secured additional financing and at March 31, 2020, we held $471.1 million of cash. We believe we currently have ample liquidity to manage our cash needs. The Governors of Oregon and Washington issued stay-at-home orders on March 23, 2020. Therefore, for the period ending March 31, 2020, we did not see significant effects from the COVID-19 pandemic or economic slowdown.

"While we can't predict the full economic effects of COVID-19, I see several mitigating factors for our business," said David H. Anderson. "The onset of the pandemic coincided with the end of our heating season, and we expect volumes to continue declining naturally during the upcoming summer months as the heating load drops off. Second, we have a strong customer mix with about 87% of our utility margin coming from the residential and commercial sectors. In addition, a majority of our utility margin is decoupled and weather normalized. Finally, we work hard to ensure our product remains affordable. As a result of our commitment to efficient operations and the decline in natural gas prices, today our customers' natural gas bills are about 40% lower than they were 15 years ago."

While we are unable to predict with certainty the length, severity or impacts of the COVID-19 pandemic and economic disruptions on our business, at this time we are monitoring the following items: customer losses, bad debt expense, lower late charge and reconnection fee revenues, and regulatory recovery. We've applied for regulatory deferrals to recover COVID-19 related costs such as bad debt expense, lost revenues related to late fees and reconnection fees, and other COVID-19 related costs.

On April 20, 2020, the Oregon Governor in conjunction with the West Coast coalition of governors, issued a preliminary high-level framework for reopening the economy, which is expected to be finalized in early May. The framework outlines a phased approach to lifting restrictions after the state experiences a declining number of COVID-19 cases, adequate hospital capacity, robust testing and sufficient supplies of personal protective equipment among other things. In addition, the Washington Governor has begun easing restrictions. We'll closely monitor the timing of the reopening of the economies and their effects on our businesses.

The majority of our capital projects continue to move forward at this time. New home construction continues in Oregon, where approximately 90% of our natural gas customers are located. Construction in Washington temporarily halted from March 26, 2020 through April 24, 2020, but has now reopened in accordance with Governor Inslee's executive orders.

Given the evolving nature of the pandemic, we're continually monitoring our business operations and the larger trends and developments to take additional measures we believe are warranted to continue providing safe and reliable service to our customers and communities while protecting our employees.

Water Utilities and Acquisitions

NW Natural Holdings' subsidiary, NW Natural Water Company, LLC (NW Natural Water), closed four acquisitions to-date in 2020: the Suncadia water and wastewater utilities in Washington, the T&W water utility in Texas, and two smaller utilities in Idaho. NW Natural Water currently serves about 61,000 people through about 25,000 connections in the Pacific Northwest and Texas. One additional acquisition is pending in Idaho that serves approximately 300 connections near our existing water utility in Idaho Falls and is expected to close in 2020. NW Natural Water has invested approximately $110 million in the water sector to date.

2

FIRST QUARTER RESULTS

The following financial comparisons are for the first quarter of 2020 and 2019 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.

Financial Implications of March 2019 Regulatory Order

In March 2019, NW Natural received a regulatory order from the Public Utility Commission of Oregon (OPUC) that outlined the recovery of a pension balancing deferral, a disallowance of a portion of this deferral, and the application of tax reform benefits.

NW Natural recognized a $10.5 million pre-tax (or $6.6 million after-tax) regulatory disallowance for amounts in the pension balancing account. This resulted in $3.9 million pre-tax ($2.8 million after-tax) of additional operations and maintenance expense, $6.6 million of pre-tax ($4.9 million after-tax) other expense, and an offsetting tax benefit of $3.9 million. In addition, as a result of beginning collections of the pension balancing account, $3.8 million of regulatory interest income ($2.8 million after-tax) was recognized related to the equity interest component of financing costs on the pension balancing account.

The order required the application of tax reform benefits to the pension balancing deferral account in March 2019, which resulted in the following offsetting adjustments with no material effect on net income:

• $7.1 million pre-tax ($5.2 million after-tax) increase in margin;

• $4.6 million pre-tax ($3.4 million after-tax) increase in operations and maintenance expense;

• $7.9 million pre-tax ($5.8 million after-tax) increase in other expense; and

• $4.3 million decrease in income tax expense with an additional tax benefit of $1.2 million recognized later in 2019.

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

	Three Months Ended March 31,
	2020				2019				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	$	47,943	$	1.57	$	41,206	$	1.42	$	6,737		$	0.15
Regulatory pension disallowance, net	—		—		6,588		0.23		(6,588		)	(0.23		)
Adjusted Natural Gas Distribution segment1	$	47,943	$	1.57	$	47,794	$	1.65	$	149		$	(0.08	)
Other	$	333	$	0.01	$	2,212	$	0.08	$	(1,879	)	$	(0.07	)
Consolidated	$	48,276	$	1.58	$	43,418	$	1.50	$	4,858		$	0.08
Adjusted Consolidated1	48,276		1.58		50,006		1.73		(1,730		)	(0.15		)
Diluted Shares			30,535				28,970					1,565

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 $10.5 million pre-tax (or $6.6 million after-tax). See "Reconciliation to GAAP" for additional information.

Natural Gas Distribution Segment

Natural Gas Distribution segment net income increased $6.7 million (or $0.15 per share). First quarter 2019 results include a $6.6 million non-cash after-tax regulatory disallowance of costs in NW Natural's pension balancing account. Excluding the effects of this disallowance, net income increased $0.1 million (or a decline of $0.08 per share) reflecting higher margin from new natural gas rates in Washington, customer growth, and revenues from the North Mist gas storage facility. Offsetting these revenues were higher depreciation expense and lower interest income from regulatory accounts. Earnings per share was affected by share issuances in June 2019.

Margin increased $1.1 million as higher rates in Washington, customer growth of 1.6% over the last 12 months, and the start of North Mist storage services, and gains from gas cost incentive sharing collectively contributed $8.6 million to margin. Partially offsetting this was a net detriment of $2.4 million related to 9% warmer than average weather in the first

3

quarter of 2020, compared to 9% colder than average weather for the same period in 2019. Finally, as a result of the Oregon order related to pension as described above, margin decreased $5.2 million with no significant effect on net income as offsetting adjustments were recognized through expenses and income taxes.

Operations and maintenance expense decreased $3.2 million as a result of 2019 incorporating several nonrecurring items related to the Oregon pension order described above, specifically a $2.8 million expense related to the disallowance of costs in the pension balancing account and $3.4 million of costs that were recognized with no significant effect on net income due to offsetting adjustments in margin and income taxes. Excluding these pension expenses, operations and maintenance expense increased $3.0 million related to higher compensation and benefit costs as well as additional non-payroll expenses from contractor services.

Depreciation expense and general taxes increased $2.6 million related to higher property, plant, and equipment, including our North Mist gas storage facility.

Other income, net increased $7.3 million primarily due to several items related to the pension order in 2019 as described above including a $4.9 million expense related to the disallowance of costs in the pension balancing account, $5.8 million of costs that were offset with higher revenues and tax benefits, and $2.8 million of equity interest income recognized in 2019 when we began collecting deferred pension costs from customers. Excluding these items, other income declined $0.6 million primarily as a result of the completion of the North Mist expansion and recording lower AFUDC.

Tax expense reflected a $4.3 million detriment related to implementing the March 2019 order described above; however, as this offset higher expense, there was no significant resulting effect on net income.

Other

Other net income decreased $1.9 million (or $0.07 per share) primarily reflecting lower asset management revenues.

BALANCE SHEET AND CASH FLOWS

During the first three months of 2020, the Company generated $102.9 million in operating cash flows and invested $57.4 million in utility capital expenditures and $37.9 million to acquire water and wastewater utilities. Net cash provided by financing activities was $460.0 million for the first three months of 2020 or an increase of $513.6 million compared to the same period in 2019 primarily due to several financings in March 2020 that strengthened our liquidity position as a precaution given COVID-19 effects.

2020 GUIDANCE

NW Natural Holdings reaffirmed 2020 earnings guidance from continuing operations in the range of $2.25 to $2.45 per share and guided toward the lower end of the range due to potential implications from COVID-19. This guidance assumes continued customer growth, average weather conditions, and no significant changes in prevailing regulatory policies, mechanisms, or outcomes, or significant local, state or federal laws, legislation or regulations. The expected sale of Gill Ranch and the related gain, and any operating loss 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

NW Natural Holdings' Board of Directors previously declared a quarterly dividend of 47.75 cents per share on NW Natural Holdings' common stock. The dividend is payable on May 15, 2020 to shareholders of record on April 30, 2020, reflecting an annual indicated dividend rate of $1.91 per share.

CONFERENCE CALL AND WEBCAST

As previously announced, NW Natural Holdings will host a conference call and webcast today to discuss its first quarter2020 financial and operating results.

Date and Time:	Friday, May 8 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

4

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 10141985.

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 over 160 years in the Pacific Northwest. It owns NW Natural Gas Company (NW Natural), NW Natural Water Company (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 760,000 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 provides water distribution and wastewater services to communities throughout the Pacific Northwest and Texas. NW Natural Water currently serves approximately 61,000 people through about 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

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 timing, completion and integration thereof, dispositions and timing, completion and outcomes thereof, global, national and local economies, 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, availability and sources of 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, effects, extent, severity and duration of COVID-19 and resulting economic disruption, the impact of mitigating factors and other efforts to mitigate risks posed by its spread, ability of our workforce, customers or suppliers to operate or conduct business, COVID-19 expenses and cost recovery including through regulatory deferrals, impact on capital projects, governmental actions and timing thereof, including actions to reopen the economy, 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

5

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.

6

NORTHWEST NATURAL HOLDINGS
Consolidated Income Statement and Financial Highlights (Unaudited)
First Quarter 2020
		Three Months Ended							Twelve Months Ended
In thousands, except per share amounts, customer, and degree day data		March 31,							March 31,
		2020			2019			Change	2020			2019			Change
Operating revenues		$	285,151		$	285,348		—%	$	746,175		$	727,856		3%
Operating expenses:
	Cost of gas	108,538			105,457			3	257,992			252,870			2
	Operations and maintenance	48,921			51,482			(5)	175,630			168,657			4
	Environmental remediation	4,005			8,947			(55)	7,395			15,450			(52)
	General taxes	9,895			9,027			10	33,256			31,725			5
	Revenue taxes	11,743			11,926			(2)	30,142			29,579			2
	Depreciation and amortization	24,675			21,572			14	94,599			85,853			10
	Other operating expenses	928			892			4	3,286			3,266			1
	Total operating expenses	208,705			209,303			—	602,300			587,400			3
Income from operations		76,446			76,045			1	143,875			140,456			2
Other income (expense), net		(3,575		)	(13,747		)	(74)	(12,664		)	(16,514		)	(23)
Interest expense, net		10,468			10,205			3	42,948			37,990			13
Income before income taxes		62,403			52,093			20	88,263			85,952			3
Income tax expense		14,127			8,675			63	18,094			17,234			5
Net income from continuing operations		48,276			43,418			11	70,169			68,718			2
Loss from discontinued operations, net of tax		(778		)	(217		)	259	(4,137		)	(2,485		)	66
Net income		$	47,498		$	43,201		10	$	66,032		$	66,233		—
Common shares outstanding:
	Average diluted for period	30,535			28,970				29,451			28,904
	End of period	30,528			28,962				30,528			28,962
Per share of common stock information:
Diluted earnings from continuing operations		$	1.58		$	1.50			$	2.38		$	2.38
Diluted loss from discontinued operations, net of tax		(0.02		)	(0.01		)		(0.14		)	(0.09		)
Diluted earnings		1.56			1.49				2.24			2.29
Dividends paid per share		0.4775			0.4750				1.9050			1.8950
Book value, end of period		29.64			27.42				29.54			27.42
Market closing price, end of period		61.75			65.63				61.75			65.63
Capital structure, end of period:
	Common stock equity	37.5		%	46.5		%		37.5		%	46.5		%
	Long-term debt	39.6			37.0				39.6		%	37.0		%
	Short-term debt (including current maturities of long-term debt)	22.9			16.5				22.9		%	16.5		%
	Total	100.0		%	100.0		%		100.0		%	100.0		%
Natural Gas Distribution segment operating statistics:
Meters - end of period		766,863			754,447			1.6%	766,863			754,447			1.6%
Volumes in therms:
	Residential and commercial sales	286,872			318,103				703,116			701,247
	Industrial sales and transportation	134,045			129,635				485,217			467,741
Total volumes sold and delivered		420,917			447,738				1,188,333			1,168,988
Operating revenues:
	Residential and commercial sales	$	255,404		$	251,118			$	643,170		$	627,316
	Industrial sales and transportation	17,194			16,021				57,726			57,345
	Other distribution revenues	963			11,844				2,154			16,802
	Other regulated services	4,926			58				16,924			293
Total operating revenues		278,487			279,041				719,974			701,756
	Less: Cost of gas	108,595			105,513				258,217			253,092
	Less: Environmental remediation expense	4,005			8,947				7,395			15,450
	Less: Revenue taxes	11,743			11,926				30,142			29,579
Margin, net		$	154,144		$	152,655			$	424,220		$	403,635
Degree days:
	Average (25-year average)	1,342			1,329				2,723			2,727
	Actual	1,215			1,450			(16)%	2,474			2,540			(3)%
Percent colder (warmer) than average weather		(9		)%	9		%		(9		)%	(7		)%
	NM = Not Meaningful calculation

7

NORTHWEST NATURAL HOLDINGS
Consolidated Balance Sheets (Unaudited)	March 31,
In thousands	2020			2019
Assets:
Current assets:
Cash and cash equivalents	$	471,079		$	12,817
Accounts receivable	78,083			93,617
Accrued unbilled revenue	41,871			36,147
Allowance for uncollectible accounts	(1,335		)	(1,301		)
Regulatory assets	37,815			46,317
Derivative instruments	2,257			7,890
Inventories	34,390			19,540
Gas reserves	14,351			16,157
Income taxes receivable	—			6,000
Other current assets	26,460			20,293
Discontinued operations current assets	15,296			14,632
Total current assets	720,267			272,109
Non-current assets:
Property, plant, and equipment	3,551,065			3,439,460
Less: Accumulated depreciation	1,050,850			1,005,117
Total property, plant, and equipment, net	2,500,215			2,434,343
Gas reserves	45,234			61,907
Regulatory assets	328,024			327,194
Derivative instruments	2,451			541
Other investments	61,928			63,829
Operating lease right of use asset	79,522			6,163
Assets under sales-type leases	146,937			990
Goodwill	69,220			8,954
Other non-current assets	47,729			15,087
Total non-current assets	3,281,260			2,919,008
Total assets	$	4,001,527		$	3,191,117
Liabilities and equity:
Current liabilities:
Short-term debt	$	550,000		$	176,391
Current maturities of long-term debt	202			104,158
Accounts payable	86,766			103,207
Taxes accrued	23,837			11,004
Interest accrued	9,396			9,233
Regulatory liabilities	47,137			46,770
Derivative instruments	5,036			2,845
Operating lease liabilities	1,071			4,656
Other current liabilities	62,624			54,543
Discontinued operations current liabilities	12,801			13,282
Total current liabilities	798,870			526,089
Long-term debt	953,962			632,484
Deferred credits and other non-current liabilities:
Deferred tax liabilities	300,168			293,662
Regulatory liabilities	623,219			600,698
Pension and other postretirement benefit liabilities	224,490			220,732
Derivative instruments	939			1,161
Operating lease liabilities	79,105			1,495
Other non-current liabilities	119,033			120,569
Total deferred credits and other non-current liabilities	1,346,954			1,238,317
Equity:
Common stock	561,264			459,932
Retained earnings	351,050			342,734
Accumulated other comprehensive loss	(10,573		)	(8,439		)
Total equity	901,741			794,227
Total liabilities and equity	$	4,001,527		$	3,191,117

8

NORTHWEST NATURAL HOLDINGS
Consolidated Statements of Cash Flows (Unaudited)	Three Months Ended March 31,
In thousands	2020			2019
Operating activities:
Net income	$	47,498		$	43,201
Adjustments to reconcile net income to cash provided by operations:
Depreciation and amortization	24,675			21,572
Regulatory amortization of gas reserves	4,087			4,780
Deferred income taxes	(3,422		)	6,306
Qualified defined benefit pension plan expense	4,446			3,499
Contributions to qualified defined benefit pension plans	(3,160		)	(1,490		)
Deferred environmental expenditures, net	(3,981		)	(3,685		)
Amortization of environmental remediation	4,005			8,947
Regulatory revenue recovery deferral from TCJA	—			450
Regulatory disallowance of pension costs	—			10,500
Other	6,499			3,171
Changes in assets and liabilities:
Receivables, net	4,845			(4,891		)
Inventories	9,571			21,108
Income and other taxes	21,911			7,406
Accounts payable	(23,430		)	(14,883		)
Interest accrued	1,945			1,927
Deferred gas costs	8,239			(19,182		)
Decoupling mechanism	6,137			7,903
Other, net	(6,626		)	8,894
Discontinued operations	(376		)	(739		)
Cash provided by operating activities	102,863			104,794
Investing activities:
Capital expenditures	(57,446		)	(48,764		)
Acquisitions, net of cash acquired	(37,883		)	—
Leasehold improvement expenditures	(6,176		)	(940		)
Other	919			(1,051		)
Discontinued operations	(694		)	(301		)
Cash used in investing activities	(101,280		)	(51,056		)
Financing activities:
Proceeds from stock options exercised	68			1,546
Long-term debt issued	150,000			—
Long-term debt retired	(75,000		)	—
Proceeds from term loan due within one year	150,000			—
Change in short-term debt	250,900			(41,229		)
Cash dividend payments on common stock	(13,834		)	(12,935		)
Other	(2,137		)	(936		)
Cash provided by (used in) financing activities	459,997			(53,554		)
Increase in cash and cash equivalents	461,580			184
Cash and cash equivalents, beginning of period	9,648			12,633
Cash and cash equivalents, end of period	$	471,228		$	12,817
Supplemental disclosure of cash flow information:
Interest paid, net of capitalization	$	8,368		$	7,976
Income taxes paid (refunded), net	(256		)	(90		)

9

NORTHWEST NATURAL HOLDINGS
Reconciliation to GAAP (Unaudited)
First Quarter 2020
	Three Months Ended March 31,
	2020				2019
In thousands, except per share data	Amount		Per Share		Amount			Per Share
CONSOLIDATED
GAAP net income from continuing operations	$	48,276	$	1.58	$	43,418		$	1.50
Regulatory pension disallowance	—		—		10,500			0.36
Income tax effect of regulatory disallowance1	—		—		(3,912		)	(0.13		)
Adjusted net income from continuing operations	$	48,276	$	1.58	$	50,006		$	1.73
Diluted shares			30,535					28,970
NATURAL GAS DISTRIBUTION SEGMENT
GAAP net income	$	47,943	$	1.57	$	41,206		$	1.42
Regulatory pension disallowance	—		—		10,500			0.36
Income tax effect of regulatory disallowance1	—		—		(3,912		)	(0.13		)
Adjusted net income	$	47,943	$	1.57	$	47,794		$	1.65

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	May 08, 2020
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	250 SW Taylor Street
Entity Registrant Name	NORTHWEST NATURAL HOLDING COMPANY
Document Type	8-K
Document Period End Date	May 08, 2020
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	97204
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	250 SW Taylor Street
Entity Registrant Name	NORTHWEST NATURAL GAS COMPANY
Document Type	8-K
Document Period End Date	May 08, 2020
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	97204
Local Phone Number	226-4211
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false