South Jersey Industries
IDEAS Conference – Chicago
August 31, 2016
Forward Looking Statements
Certain statements contained in this presentation may qualify as “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934. All statements other than statements of historical fact should be considered forward-looking
statements made in good faith and are intended to qualify for the safe harbor from liability established
by the Private Securities Litigation Reform Act of 1995. Words such as “anticipate”, “believe”, “expect”,
“estimate”, “forecast”, “goal”, “intend”, “objective”, “plan”, “project”, “seek”, “strategy” and similar
expressions are intended to identify forward-looking statements. Such forward-looking statements are
subject to risks and uncertainties that could cause actual results to differ materially from those
expressed or implied in the statements. These risks and uncertainties include, but are not limited to, the
following: general economic conditions on an international, national, state and local level; weather
conditions in our marketing areas; changes in commodity costs; changes in the availability of natural
gas; “non-routine” or “extraordinary” disruptions in our distribution system; regulatory, legislative and
court decisions; competition; the availability and cost of capital; costs and effects of legal proceedings
and environmental liabilities; the failure of customers or suppliers to fulfill their contractual obligations;
and changes in business strategies. These cautionary statements should not be construed by you to be
exhaustive. While SJI believes these forward-looking statements to be reasonable, there can be no
assurance that they will approximate actual experience. Further, SJI undertakes no obligation to update
or revise any of its forward-looking statements, whether as a result of new information, future events or
otherwise.
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South Jersey Industries
Business Overview
4
South Jersey Gas SJI Midstream
South Jersey Energy
Solutions
Regulated Natural
Gas Distribution
Company
FERC-Regulated
Gas Pipelines
SJ Energy
Services
SJ Energy
Group
• Energy production
portfolio (solar, CHP
and landfill gas)
• Meter reading, HVAC
and appliance
maintenance
• Fuel management
services
• Wholesale and
retail natural gas
and electric
commodity
marketing
$66.6mm Economic Earnings(1)
$31.5mm Economic Earnings(1)
Regulated Non-Utility
(1) 2015 reported results. Excludes corporate segment results. As reported; not adjusted for one-time items. SJI uses the non-GAAP measure of Economic
earnings. EE eliminates all unrealized gains and losses on commodity and on the ineffective portion of interest rate derivative transactions; adjusts for realized
gains and losses attributed to hedges on inventory transactions and for the impact of transactions or contractual arrangements where the true economic impact
will be realized in a future period. A full explanation and reconciliation of this non-GAAP measure is provided in our Form 10K on file with the SEC.
Organizational Structure
2012 2013 2014 2015
June 30
2016
Operating Results
Economic Earnings¹ $93,313 $97,094 $103,979 $98,974 $65,702
Economic EPS –
Continuing Operations $1.51 $1.51 $1.57 $1.44 $0.89
Share Data
Dividend Payout 54.5% 58.4% 61.3% 70.9% -
Annualized Dividends
Declared* $0.89 $0.95 $1.01 $1.05 -
Market Price – Period End*
* Adjusted for May 2015 Stock
Split $25.17 $27.98 $29.47 $23.52 $31.62
5
¹ SJI uses the non-GAAP measure of Economic Earnings (EE) when discussing results. See explanation on slide 4.
Selected Financial Data
Strategic Priorities
• Targeting $150MM of Economic Earnings by 2020, with 70%-80% from regulated
businesses
• $1.5bn capex program, ≈93% related to utility or FERC regulated investments
• Elimination of contribution from ITC
• Balanced financing strategy with commitment to strong, investment grade
ratings
• Ample access to liquidity
6
Visible and high
quality earnings
growth
Attractive
regulatory and
contracted
assets
Minimize risk
where possible
Commitment to
strong financial
position
• $1bn projected utility investment from 2016-2020 in constructive NJ regulatory
jurisdiction
• Above industry average customer growth anticipated
• 20% ownership interest in FERC regulated PennEast pipeline
• Disciplined approach to non-utility businesses, emphasizing pro-active risk
management strategy
• Long term contracts for fuel supply management and energy production
Economic Earnings Profile
7
(1) Economic Earnings is a non-GAAP measure; see slide 4 for further information.
$99.0
$150.0
2015 2020 Target
Economic Earnings(1) ($MM) % Utility and Regulated Earnings
67%
~70%-80%
2015 2020 TargetITC contribution to total SJI EE
39% 0%
70%
23%
7%
56%
1%
43%
8
$MM
Anticipated $1.5bn of capex 2016-2020¹, focused on regulated utility and
FERC pipeline growth
(1) Capital expenditures shown are inclusive of affiliate investments
2013A-2015A
2016P-2020P
% Utility and
FERC regulated:
57%
% Utility and
FERC regulated:
93%
$317
$344 $354
$303
$388 $382
$203
$225
2013A 2014A 2015A 2016P 2017P 2018P 2019P 2020P
Regulated Utility FERC regulated Non-Utility
SJI: Anticipated Capex
South Jersey Gas
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• 375,000+ customers served in southern
New Jersey
• Regulated by the NJ Board of Public
Utilities
• Rate base = $1.2 billion
• Allowed ROE = 9.75%
• Allowed equity/cap = 51.9%
• 2016P-2020P targeted PP&E growth
=70%
Regulated Utility Profile
11
$122 $92 $93 $94 $95
$38
$35 $35 $35 $35
$28
$35 $35 $35 $35
$33
$44
$105
$19
$206
$268
$183 $169
2016P 2017P 2018P 2019P 2020P
$221
Utility Growth Drivers
Base Capital
Two rate case filings expected through 2020
≈ $500MM planned capital investment 2016-2020
Other / Liquefaction
Planned spending of ≈$95MM for 2016-2020
Liquefaction spend largely complete in 2015
BL England
Proposed ≈ $100MM pipeline to supply natural gas to the
former BL England generating facility
NJBPU approval received in December, appeals pending
AIRP (Accelerated Infrastructure Replacement Program)
Earn ROI until included in a future base rate proceeding
Filed in June for 7-year, $500MM program
Planned investments total $178MM for 2016-2020
SHARP (Storm Hardening and Reliability Program)
Earn ROI with annual roll-in
Planned investments total $168MM for 2016-2020
Base
capital
47%
AIRP
17%
SHARP
16%
Other
8%
Liquefaction
1%
BL England
11%
2016P-2020P: $1,047 mm
2016-2020 Utility Cap-Ex Breakdown
$MM
Conversions: Commercial Conversions: Residential
New construction: Commercial New construction: Residential
12
% net
growth
+1.0% +1.7% +1.4% +1.3% +1.7%
Strong customer growth
$808
$1,250
$2,748
$3,340
Natural Gas Oil Propane Electricity
Competitive economics of
gas vs. other fuels
(1) Fuel comparison based on March 2016 EIA data
Annual Commodity Cost for a Typical Residential Customer(1) Gross Customer Additions
6,030 6,060
7,431 7,484
8,393
8,751
2010 2011 2012 2013 2014 2015
Utility Customer Trends and Drivers
SJI Midstream
14
PennEast Pipeline Project
• $200M investment with FERC regulated returns
• 20% equity owner in $1.0B+, 1 BCF, 118-mile interstate pipeline from Marcellus
region of PA into NJ
• Fully subscribed with 80% of capacity under 15-year agreements with
utility/energy affiliates of project sponsors
15
PennEast Pipeline Project
Application
submitted
9/24/15
FERC draft EIS
issued 7/22/16
Final
environmental
review
expected Dec
2016
Targeted in-
service date
2H 2018
Draft Environmental Impact Statement
7/22/16 – “FERC staff determined that construction and operation of the
Project would result in some adverse environmental impacts, but impacts
would be reduced to less-than-significant levels with the implementation of
PennEast’s proposed and FERC staff’s recommended mitigation measures. ”
≈44 miles of the 115 mile pipeline would be constructed in existing
rights of way
PennEast would minimize impacts on natural and cultural resources during
construction and operation of the project
PennEast would comply with all applicable air and noise regulatory
requirements during construction and operation of the Project.
South Jersey Energy Solutions
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• Retail electric and natural gas marketing across 8 states, with matched book approach and
minimal open positions
• Relationship driven marketing business matches Marcellus producers with end users,
maximizing the value of our leased transportation assets through a combination of index
based/plus margin contracts and the ability to arbitrage
• Executed ten fuel supply management contracts, expect all to contribute by 2020
• Contract terms range from 4 to 15 years, with credit arrangements, commodity pricing
and imbalance management to mitigate risk
• Exited Energenic JV and restructured business with focus on cash production from existing
assets
• Solar contribution expected to reflect improved SREC values, active hedging program, and
the elimination of earnings from ITC
•Operating CHP assets continue adding to bottom line
• Remaining landfill assets support long-term PPA with Borgata
Non-Utility Profile
Wholesale & Retail Commodity
Fuel Management
Energy Production
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Business Line
% Composition of
Total SJI Economic Earnings(1)
2015A 2020 Target
Wholesale & Retail Commodity 13% 11% - 14%
Fuel Management 3% 6% - 9%
Energy Production 14% 2% - 4%
Other (HVAC, Meter Reading, SJEX) 2% 1% - 2%
% of Total SJI EE 32% 20% – 29%
Solar ITC Contribution 39% 0%
(1) Economic Earnings is a non-GAAP measure; see slide 4 for further information.
Non-Utility Growth Summary
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Counterparty Location
Capacity
(MW)
Volume
(Dth/day) Start Date Term
NextEra/Starwood
Energy Marcus Hook, PA 750 80,000 In service
2016 -
evergreen
LS Power West Deptford, NJ 738 36,000 In service 15 Years
LS Power II West Deptford, NJ 400 31,000 In service 15 Years
Moxie - Liberty Bradford Co, PA 825 137,655 2016 5 Years
Moxie - Patriot Lycoming Co, PA 825 137,655 2016 4 Years
Panda - Stonewall Leesburg, VA 750 110,000 2017 4 Years
Moxie - Freedom Luzerne, PA 1,029 157,000 2018 10 Years
Lordstown Trumbell, OH 1,029 160,000 2018 5 Years
Invenergy -
Lackawanna Jessup, PA 1,045 210,000 2018 10 Years
Economic Earnings Contribution = $10 to $12 million by 2020
Fuel Supply Management
South Jersey Industries
Performance / Projections
$60.8
$65.7
$10
$20
$30
$40
$50
$60
$70
$80
2015 2016
21
$0.89 $0.89
$0.50
$0.60
$0.70
$0.80
$0.90
$1.00
$1.10
$1.20
2015 20162015 2016
Economic Earnings ($ in millions) Economic EPS
YTD 2016 Performance as of 6/30/16
22
Business Unit 2015
2016
Anticipated
2020
Projected
Utility 67% 67% - 70% 62% - 70%
Midstream --- --- 8% - 12%
Energy Services 16% 10% - 15% 3% - 6%
Energy Group 17% 18% - 23% 17% - 23%
Contribution to Economic Earnings
Performance Highlights/Drivers
Visible and high
quality earnings
growth
• 8% YOY increase in Economic Earnings through Q2
• On track to achieve EPS target between $1.29 - $1.35
• Highly successful equity offering generated net proceeds of
over $203MM in Q2
• Equity to cap ratio at 51.1% 23
Attractive
regulatory and
contracted
assets
Minimize risk
where possible
Commitment to
strong financial
position
• Added 3,497 customers through Q2
• $40MM liquefaction facility complete
• 10 fuel supply management contracts executed
• Aggressive solar REC hedging program protects revenue
• Long term PPAs and fuel supply contracts with creditworthy
entities