NiSource Inc. Files 10-Q for Q2 2024

TL;DR

NiSource Q2 10-Q is in. Financials and ops updated.

AI Summary

NiSource Inc. filed its 10-Q for the period ending June 30, 2024. The filing details financial performance and operational updates for the second quarter and the first half of the year. Key financial metrics and business segments are presented, reflecting the company's ongoing activities in the energy sector.

Why It Matters

This filing provides investors and analysts with the latest financial and operational data for NiSource Inc., crucial for understanding the company's performance and future outlook in the utility sector.

Risk Assessment

Risk Level: medium — As a utility company, NiSource is subject to regulatory changes, infrastructure risks, and market fluctuations impacting its financial stability.

Key Numbers

• 2024-06-30 — Reporting Period End Date (Indicates the end of the financial period covered by the report.)
• 2024-08-07 — Filing Date (The date the 10-Q was officially submitted to the SEC.)
• 2024-01-01 to 2024-06-30 — Year-to-Date Period (Covers the first six months of the fiscal year 2024.)
• 2023-01-01 to 2023-06-30 — Prior Year-to-Date Period (Provides a comparative period for the first six months of fiscal year 2023.)
• 2024-04-01 to 2024-06-30 — Second Quarter 2024 (Specific financial data for the second quarter of 2024.)

Key Players & Entities

• NiSource Inc. (company) — Filer of the 10-Q
• 20240630 (date) — End of the reporting period
• 20240807 (date) — Filing date
• MERRILLVILLE, IN (location) — Company headquarters

FAQ

Key Financial Figures

• $0.01 — ich Registered Common Stock, par value $0.01 per share NI NYSE Indicate by check m

Filing Documents

• nix-20240630.htm (10-Q) — 2452KB
• ni-ex311x20240630.htm (EX-31.1) — 11KB
• ni-ex312x20240630.htm (EX-31.2) — 11KB
• ni-ex321x20240630.htm (EX-32.1) — 5KB
• ni-ex322x20240630.htm (EX-32.2) — 5KB
• 0001111711-24-000032.txt ( ) — 10716KB
• nix-20240630.xsd (EX-101.SCH) — 62KB
• nix-20240630_cal.xml (EX-101.CAL) — 80KB
• nix-20240630_def.xml (EX-101.DEF) — 454KB
• nix-20240630_lab.xml (EX-101.LAB) — 655KB
• nix-20240630_pre.xml (EX-101.PRE) — 544KB
• nix-20240630_htm.xml (XML) — 1868KB

FINANCIAL INFORMATION

PART I FINANCIAL INFORMATION

Financial Statements - unaudited

Item 1. Financial Statements - unaudited Condensed Statements of Consolidated Income (unaudited) 8 Condensed Statements of Consolidated Comprehensive Income (unaudited) 9 Condensed Consolidated Balance Sheets (unaudited) 10 Condensed Statements of Consolidated Cash Flows (unaudited) 12 Condensed Statements of Consolidated Equity (unaudited) 14 Notes to Condensed Consolidated Financial Statements (unaudited) 17

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 39

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 62

Controls and Procedures

Item 4. Controls and Procedures 62

OTHER INFORMATION

PART II OTHER INFORMATION

Legal Proceedings

Item 1. Legal Proceedings 63

Risk Factors

Item 1A. Risk Factors 63

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 63

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 63

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 63

Other Information

Item 5. Other Information 63

Exhibits

Item 6. Exhibits 64 Signature 65 2 DEFINED TERMS The following is a list of frequently used abbreviations or acronyms that are found in this report: NiSource Subsidiaries and Affiliates (not exhaustive) Columbia of Kentucky Columbia Gas of Kentucky, Inc. Columbia of Maryland Columbia Gas of Maryland, Inc. Columbia of Ohio Columbia Gas of Ohio, Inc. Columbia of Pennsylvania Columbia Gas of Pennsylvania, Inc. Columbia of Virginia Columbia Gas of Virginia, Inc. NIPSCO Northern Indiana Public Service Company LLC NIPSCO Holdings I NIPSCO Holdings I LLC NIPSCO Holdings II NIPSCO Holdings II LLC NiSource ("we," "us" or "our") NiSource Inc. Rosewater Rosewater Wind Generation LLC and its wholly owned subsidiary, Rosewater Wind Farm LLC Indiana Crossroads Wind Indiana Crossroads Wind Generation LLC and its wholly owned subsidiary, Indiana Crossroads Wind Farm LLC Indiana Crossroads Solar Indiana Crossroads Solar Generation LLC and its wholly owned subsidiary, Meadow Lake Solar Park LLC Dunns Bridge I Dunn's Bridge I Solar Generation LLC and its wholly owned subsidiary, Dunns Bridge Solar Center, LLC Dunns Bridge II Dunn's Bridge II Solar Generation LLC Gibson Gibson Solar Generation LLC Fairbanks Fairbanks Solar Generation LLC Cavalry Cavalry Solar Generation LLC Abbreviations and Other AFUDC Allowance for funds used during construction AOCI Accumulated Other Comprehensive Income (Loss) ASC Accounting Standards Codification ASU Accounting Standards Update ATM At-the-market BIP BIP Blue Buyer L.L.C BIP Blue Buyer VCOC L.L.C BIP Blue Buyer VCOC L.L.C., a Delaware limited liability company and also an affiliate of Blackstone Blackstone Blackstone Infrastructure Partners L.P BTA Build-transfer agreement CCRs Coal Combustion Residuals CEP Ohio Capital Expenditure Program CERCLA Comprehensive Environmental Response Compensation and Liability Act (also known as Superfund) CODM Chief Operating Decision Maker Columbia Op

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS NiSource Inc. Condensed Statements of Consolidated Income (unaudited) Three Months Ended June 30, Six Months Ended June 30, (in millions, except per share amounts) 2024 2023 2024 2023 Operating Revenues Customer revenues $ 1,054.1 $ 1,067.2 $ 2,697.1 $ 2,963.3 Other revenues 30.6 22.8 93.9 92.7 Total Operating Revenues 1,084.7 1,090.0 2,791.0 3,056.0 Operating Expenses Cost of energy 164.7 251.9 589.7 1,017.0 Operation and maintenance 357.7 369.5 736.1 760.7 Depreciation and amortization 253.5 233.1 495.6 440.0 Loss on impairment of assets 2.9 — 2.9 — Loss (gain) on sale of assets, net 1.6 ( 0.3 ) 1.6 ( 0.3 ) Other taxes 67.3 66.9 144.7 138.7 Total Operating Expenses 847.7 921.1 1,970.6 2,356.1 Operating Income 237.0 168.9 820.4 699.9 Other Income (Deductions) Interest expense, net ( 129.3 ) ( 110.5 ) ( 245.6 ) ( 219.4 ) Other, net 13.0 2.0 22.2 3.5 Total Other Deductions, Net ( 116.3 ) ( 108.5 ) ( 223.4 ) ( 215.9 ) Income before Income Taxes 120.7 60.4 597.0 484.0 Income Taxes 17.6 14.1 93.6 99.9 Net Income 103.1 46.3 503.4 384.1 Net income (loss) attributable to noncontrolling interest 17.3 ( 12.5 ) 52.6 ( 7.7 ) Net Income Attributable to NiSource 85.8 58.8 450.8 391.8 Preferred dividends — ( 12.7 ) ( 6.7 ) ( 26.5 ) Preferred redemption premium — ( 6.2 ) ( 14.0 ) ( 6.2 ) Net Income Available to Common Shareholders $ 85.8 $ 39.9 $ 430.1 $ 359.1 Earnings Per Share Basic Earnings Per Share $ 0.19 $ 0.10 $ 0.96 $ 0.87 Diluted Earnings Per Share $ 0.19 $ 0.09 $ 0.95 $ 0.80 Basic Average Common Shares Outstanding 448.5 413.3 448.2 413.1 Diluted Average Common Shares 450.2 446.8 449.8 446.9 The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements. 8 Table of Contents

FINANCIAL STATEMENTS (continued)

ITEM 1. FINANCIAL STATEMENTS (continued) NiSource Inc. Condensed Statements of Consolidated Comprehensive Income (unaudited) Three Months Ended June 30, Six Months Ended June 30, (in millions, net of taxes) 2024 2023 2024 2023 Net Income $ 103.1 $ 46.3 $ 503.4 $ 384.1 Other comprehensive income: Net unrealized gain (loss) on available-for-sale debt securities (1) — ( 1.2 ) ( 0.3 ) 0.8 Reclassification adjustment for cash flow hedges (2) ( 0.1 ) ( 0.2 ) ( 0.2 ) ( 0.1 ) Unrecognized pension and OPEB benefit (3) 0.3 0.3 0.5 0.6 Total other comprehensive income (loss) 0.2 ( 1.1 ) — 1.3 Comprehensive Income $ 103.3 $ 45.2 $ 503.4 $ 385.4 (1) Net unrealized gain (loss) on available-for-sale debt securities, net of $ 0.0 million tax expense and $ 0.3 million tax benefit in the second quarter of 2024 and 2023, respectively, and $ 0.1 million of tax benefit and $ 0.2 million tax expense for the six months ended 2024 and 2023, respectively. (2) Reclassification adjustment for cash flow hedges, net of $ 0.0 million tax benefit and $ 0.0 million tax expense in the second quarter of 2024 and 2023, respectively, and $ 0.0 million of tax benefit and $ 0.1 million tax benefit for the six months ended 2024 and 2023, respectively. (3) Unrecognized pension and OPEB benefit, net of $ 0.1 million of tax expense and $ 0.1 million tax expense in the second quarter of 2024 and 2023, respectively, and $ 0.2 million of tax expense and $ 0.2 million tax expense for the six months ended 2024 and 2023, respectively. The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements. 9 Table of Contents

FINANCIAL STATEMENTS (continued)

ITEM 1. FINANCIAL STATEMENTS (continued) NiSource Inc. Condensed Consolidated Balance Sheets (unaudited) (in millions) June 30, 2024 December 31, 2023 ASSETS Property, Plant and Equipment Plant $ 32,031.1 $ 30,482.1 Accumulated depreciation and amortization ( 8,418.5 ) ( 8,207.2 ) Net Property, Plant and Equipment (1) 23,612.6 22,274.9 Investments and Other Assets Unconsolidated affiliates 5.4 5.3 Available-for-sale debt securities (amortized cost of $ 155.5 and $ 169.0 , allowance for credit losses of $ 0.3 and $ 0.6 , respectively) 145.5 159.1 Other investments 84.9 82.7 Total Investments and Other Assets 235.8 247.1 Current Assets Cash and cash equivalents 101.2 2,245.4 Restricted cash 34.7 35.7 Accounts receivable 650.2 884.9 Allowance for credit losses ( 26.2 ) ( 22.9 ) Accounts receivable, net 624.0 862.0 Gas storage 133.1 265.8 Materials and supplies, at average cost 180.8 172.1 Electric production fuel, at average cost 59.3 65.3 Exchange gas receivable 13.0 66.0 Regulatory assets 278.4 214.3 Deposits to renewable generation asset developer 381.1 454.2 Prepayments and other 138.2 118.6 Total Current Assets (1) 1,943.8 4,499.4 Other Assets Regulatory assets 2,221.7 2,245.9 Goodwill 1,485.9 1,485.9 Deferred charges and other 397.8 324.0 Total Other Assets 4,105.4 4,055.8 Total Assets $ 29,897.6 $ 31,077.2 (1) Includes $ 1,346.8 million and $ 1,369.8 million at June 30, 2024 and December 31, 2023, respectively, of net property, plant and equipment assets and $ 62.8 million and $ 63.6 million at June 30, 2024 and December 31, 2023, respectively, of current assets of consolidated VIEs that may be used only to settle obligations of the consolidated VIEs. Refer to Note 4, "Noncontrolling Interests," for additional information. The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements. 10 Table of Contents

FINANCIAL STATEMENTS (continued)

ITEM 1. FINANCIAL STATEMENTS (continued) NiSource Inc. Condensed Consolidated Balance Sheets (unaudited) (continued) (in millions, except share amounts) June 30, 2024 December 31, 2023 CAPITALIZATION AND LIABILITIES Capitalization Stockholders' Equity Common stock - $ 0.01 par value, 750,000,000 shares authorized; 448,398,632 and 447,381,671 shares outstanding, respectively $ 4.5 $ 4.5 Preferred stock - $ 0.01 par value, 20,000,000 shares authorized; 0 and 40,000 shares outstanding, respectively — 486.1 Treasury stock ( 99.9 ) ( 99.9 ) Additional paid-in capital 8,894.2 8,879.5 Retained deficit ( 896.2 ) ( 967.0 ) Accumulated other comprehensive loss ( 33.6 ) ( 33.6 ) Total NiSource Stockholders' Equity 7,869.0 8,269.6 Noncontrolling interest in consolidated subsidiaries 1,950.6 1,866.7 Total Stockholders' Equity 9,819.6 10,136.3 Long-term debt, excluding amounts due within one year 12,809.6 11,055.5 Total Capitalization 22,629.2 21,191.8 Current Liabilities Current portion of long-term debt 23.4 23.8 Short-term borrowings 644.0 3,048.6 Accounts payable 584.0 749.4 Dividends payable - common stock 120.0 — Customer deposits and credits 187.7 294.4 Taxes accrued 163.7 166.2 Interest accrued 146.4 136.1 Exchange gas payable 34.7 50.5 Regulatory liabilities 193.4 278.6 Asset retirement obligations 69.6 72.5 Accrued compensation and employee benefits 174.0 227.6 Other accruals 167.1 217.4 Total Current Liabilities (1) 2,508.0 5,265.1 Other Liabilities Deferred income taxes 2,198.2 2,080.4 Accrued liability for postretirement and postemployment benefits 241.8 250.1 Regulatory liabilities 1,456.5 1,510.7 Asset retirement obligations 555.6 480.5 Other noncurrent liabilities and deferred credits 308.3 298.6 Total Other Liabilities (1) 4,760.4 4,620.3 Commitments and Contingencies (Refer to Note 16, "Other Commitments and Contingencies") Total Capitalization and Liabilities $ 29,897.6 $ 31,07

FINANCIAL STATEMENTS (continued)

ITEM 1. FINANCIAL STATEMENTS (continued) NiSource Inc. Condensed Statements of Consolidated Cash Flows (unaudited) Six Months Ended June 30, (in millions) 2024 2023 Operating Activities Net Income $ 503.4 $ 384.1 Adjustments to Reconcile Net Income to Net Cash from Operating Activities: Depreciation and amortization 495.6 440.0 Deferred income taxes and investment tax credits 85.1 93.0 Loss (Gain) on sale of assets 1.6 ( 0.3 ) Payments for asset retirement obligations ( 35.0 ) ( 15.0 ) Other adjustments 2.5 6.6 Changes in Assets and Liabilities: Components of working capital ( 116.2 ) 300.6 Regulatory assets/liabilities ( 5.9 ) 12.6 Deferred charges and other noncurrent assets ( 32.7 ) ( 18.4 ) Other noncurrent liabilities and deferred credits 3.3 ( 12.2 ) Net Cash Flows from Operating Activities 901.7 1,191.0 Investing Activities Capital expenditures ( 1,219.3 ) ( 1,161.9 ) Milestone payments to renewable generation asset developer ( 320.8 ) ( 137.4 ) Other investing activities ( 53.9 ) ( 76.3 ) Net Cash Flows used for Investing Activities ( 1,594.0 ) ( 1,375.6 ) Financing Activities Proceeds from issuance of long-term debt 1,734.5 1,488.7 Repayments of finance lease obligations ( 13.5 ) ( 16.1 ) Repayment of short term credit agreements ( 1,650.0 ) — Net change in commercial paper and other short-term borrowings ( 754.6 ) ( 172.2 ) Issuance of common stock, net of issuance costs 5.6 6.3 Redemption of preferred stock ( 486.1 ) ( 393.9 ) Preferred stock redemption premium ( 14.0 ) ( 6.2 ) Equity costs, premiums and other debt related costs ( 60.0 ) ( 16.7 ) Contributions from NIPSCO minority interest holders 59.7 — Contributions from equity tax partners — 35.0 Distributions to tax equity partners ( 8.2 ) ( 10.0 ) Distribution to NIPSCO minority interest holders ( 20.2 ) — Dividends paid - common stock ( 237.9 ) ( 206.6 ) Dividends paid - preferred stock ( 8.2 ) ( 27.6 ) Contract liability payment — (

FINANCIAL STATEMENTS (continued)

ITEM 1. FINANCIAL STATEMENTS (continued) Supplemental Disclosures of Cash Flow Information Six Months Ended June 30, (in millions) 2024 2023 Non-cash transactions: Capital expenditures included in current liabilities $ 283.6 $ 410.2 Dividends declared but not paid 120.0 111.6 Purchase contract liability — 32.6 The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements. 13 Table of Contents

FINANCIAL STATEMENTS (continued)

ITEM 1. FINANCIAL STATEMENTS (continued) NiSource Inc. Condensed Statements of Consolidated Equity (unaudited) (in millions) Common Stock Preferred Stock Treasury Stock Additional Paid-In Capital Retained Deficit Accumulated Other Comprehensive Loss Noncontrolling Interest in Consolidated Subsidiaries Total Balance as of April 1, 2024 $ 4.5 $ — $ ( 99.9 ) $ 8,886.8 $ ( 861.7 ) $ ( 33.8 ) $ 1,899.0 $ 9,794.9 Comprehensive Income: Net income — — — — 85.8 — 17.3 103.1 Other comprehensive loss, net of tax — — — — — 0.2 — 0.2 Dividends: Common stock ($ 0.27 per share) — — — — ( 120.3 ) — — ( 120.3 ) Noncontrolling Interests: Contributions from noncontrolling interests — — — — — — 59.7 59.7 Distributions to noncontrolling interests — — — — — — ( 25.4 ) ( 25.4 ) Stock issuances: Employee stock purchase plan — — — 1.6 — — — 1.6 Long-term incentive plan — — — 3.6 — — — 3.6 401(k) and profit sharing — — — 2.2 — — — 2.2 Balance as of June 30, 2024 $ 4.5 $ — $ ( 99.9 ) $ 8,894.2 $ ( 896.2 ) $ ( 33.6 ) $ 1,950.6 $ 9,819.6 (in millions) Common Stock Preferred Stock Treasury Stock Additional Paid-In Capital Retained Deficit Accumulated Other Comprehensive Loss Noncontrolling Interest in Consolidated Subsidiaries Total Balance as of January 1, 2024 $ 4.5 $ 486.1 $ ( 99.9 ) $ 8,879.5 $ ( 967.0 ) $ ( 33.6 ) $ 1,866.7 $ 10,136.3 Comprehensive Income: Net income — — — — 450.8 — 52.6 503.4 Dividends: Common stock ($ 0.80 per share) — — — — ( 357.9 ) — — ( 357.9 ) Preferred stock (See Note 6) — — — — ( 8.1 ) — — ( 8.1 ) Noncontrolling Interests: Contributions from noncontrolling interests — — — — — — 59.7 59.7 Distributions to noncontrolling interests — — — — — — ( 28.4 ) ( 28.4 ) Stock issuances (redemptions): Series B and B-1 Preferred Stock Redemption — ( 486.1 ) — — — — — ( 486.1 ) Series B and B-1 Preferred stock redemption premium — — — — ( 14.0 ) — — ( 14.0 ) Employee stock purchase plan — — — 3.0 — — — 3.0 Long-term incent

FINANCIAL STATEMENTS (continued)

ITEM 1. FINANCIAL STATEMENTS (continued) (in millions) Common Stock Preferred Stock Treasury Stock Additional Paid-In Capital Retained Deficit Accumulated Other Comprehensive Loss Noncontrolling Interest in Consolidated Subsidiaries Total Balance as of April 1, 2023 $ 4.2 $ 1,546.5 $ ( 99.9 ) $ 7,372.9 $ ( 1,114.8 ) $ ( 34.7 ) $ 329.5 $ 8,003.7 Comprehensive Income: Net income (loss) — — — — 58.8 — ( 12.5 ) 46.3 Other comprehensive income, net of tax — — — — — ( 1.1 ) — ( 1.1 ) Dividends: Common stock ($ 0.25 per share) — — — — ( 103.4 ) — — ( 103.4 ) Preferred stock (See Note 6) — — — — ( 8.2 ) — — ( 8.2 ) Noncontrolling Interests: Contributions from noncontrolling interests (1) — — — — — — 28.7 28.7 Distributions to noncontrolling interest — — — — — — ( 4.7 ) ( 4.7 ) Stock issuances (redemptions): Series A Preferred stock redemption — ( 393.9 ) — — — — — ( 393.9 ) Series A Preferred stock redemption premium — — — — ( 6.2 ) — — ( 6.2 ) Employee stock purchase plan — — — 1.5 — — — 1.5 Long-term incentive plan — — — 6.2 — — — 6.2 401(k) and profit sharing — — — 2.5 — — — 2.5 Balance as of June 30, 2023 $ 4.2 $ 1,152.6 $ ( 99.9 ) $ 7,383.1 $ ( 1,173.8 ) $ ( 35.8 ) $ 341.0 $ 7,571.4 (1) Contributions from noncontrolling interest is net of transaction costs. (in millions) Common Stock Preferred Stock Treasury Stock Additional Paid-In Capital Retained Deficit Accumulated Other Comprehensive Loss Noncontrolling Interest in Consolidated Subsidiaries Total Balance as of January 1, 2023 $ 4.2 $ 1,546.5 $ ( 99.9 ) $ 7,375.3 $ ( 1,213.6 ) $ ( 37.1 ) $ 326.4 $ 7,901.8 Comprehensive Income: Net income (loss) — — — — 391.8 — ( 7.7 ) 384.1 Other comprehensive income, net of tax — — — — — 1.3 — 1.3 Dividends: Common stock ($ 0.75 per share) — — — — ( 310.1 ) — — ( 310.1 ) Preferred stock (See Note 6) — — — — ( 35.7 ) — — ( 35.7 ) Noncontrolling Interests: Contributions from noncontrolling interests (1) — — — — — — 32.3 32.3 Distributi

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