RGCO 10-K & 10-Q changes, risk factors and insider trading

Security incident or cyber-attackscyber attacks on the Company’s computer or information technology systems.

The Company’s business operations and information technology systems are targets of cyber attack, and they may be vulnerable to an attack by individuals or organizations intending to disrupt the operations of the Company. Such an attack or cybersecurity incident on the Company’s information technology systems could result in corruption of the Company’s financial information; disruption of services to our customers; the unauthorized release of confidential customer, employee or vendor information; the interruption of natural gas deliveries to our customers; and/or compromise the safety of our distribution, transmission and storage systems. The Company has implemented policies, procedures and controls to prevent and detect these activities; however, there are no guarantees that Company processes will adequately protect against unauthorized access. In the event of a successfulan attack, the Company could be exposed to material financial and reputational risks, possible disruptions in natural gas deliveries or a compromise of the safety of the natural gas distribution system, as well as be exposed to claims by persons harmed by such an attack, all of which could materially increase the Company's costs to protect against such risks. The Company maintains cyber-insurance coverage, which does not protect the Company from cyber incidents but does provide some potential mitigation of the financial impacts resulting from such attacks. See Item 1C of this Form 10-K for additional discussion.

Over the last several years, the Company has implemented or acquired a variety of technological tools including both Company-owned information technology and technological services provided by outside parties. Additionally, the Company is currently upgradingupgraded its new financial system and is in the process of updating its customer information systems.system. These tools and systems support critical functions including, scheduling and dispatching of service technicians, automated meter reading systems, customer care and billing, revenue recognition, operational plant logistics, and external financial reporting. Issues in the implementation or the failure of these or other similarly important technologies, or the Company’s inability to have these technologies supported, updated, expanded, or integrated into other technologies, could hinder its business operations and adversely impact its financial condition and results of operations. Although the Company has, when possible, developed alternative sources of technology and built redundancy into its computer networks and tools, there can be no assurance that these efforts would protect against all potential issues related to the loss of any such technologies.

The Company competes with other energy providers in its service territory, including those that provide electricity, propane, coal, fuel oil, wind and solar. Price is a significant competitive factor. Higher natural gas costs or decreases in the price of other energy sources may enhance competition and encourage customers to switch to alternative energy sources, thus lowering natural gas deliveries and earnings. Price considerations could also inhibit customer and revenue growth if builders and developers do not perceive, or are regulatoriallyregulatorily prevented from installing, natural gas as a better value than other energy options and elect to install heating systems that use energy sources, including those perceived as more environmentally friendly.

Focus on ESG matters related to, among other things, concerns raised by advocacy groups about climate change, social issues and corporate governance may lead to increased regulatory review, which in turn may lead to new state and federal safety and laws, regulations, guidelines, and enforcement interpretations. SocialSocial, corporate and corporateenvironmental governance initiatives retain prominence.importance. In addition, several federal and state legislative and regulatory initiatives have been proposed and enacted in recent years in an attempt to limit the effects of climate change, including greenhouse gas emissions such as those created by the combustion of fossil fuels, including natural gas. PassageFull implementation and/or passage of environmental legislation or implementation of regulations that mandate the use of electric rather than gas appliances, or reductions in greenhouse gas emissions or other similar restrictions could have a negative effect on the Company’s core operations and its investment in the LLC. Such legislation could impose limitations on greenhouse gas emissions, require funding of new energy efficiency objectives, impose new operational requirements or lead to other additional costs to the Company. Regulations restricting or prohibiting the use of coal as a fuel for electric power generation has increased the demand for natural gas, and could at some point potentially result in natural gas supply concerns and higher costs for natural gas. Legislation or regulations could limit the exploration and development of natural gas reserves, making the price of natural gas less competitive and less attractive as a fuel source for consumers. Future legislation could also place limitations on the amount of natural gas used by businesses and homeowners to reduce the level of greenhouse gas emissions, resulting in reduced deliveries and earnings or provide incentives to customers to utilize alternative energy sources not associated with fossil fuels.

In addition, advocacy groups, both domestically and internationally, have campaigned for governmental and private action to influence change in the business strategies of oil and gas companies, including through the investment and voting practices of investment advisers,advisors, public pension funds, universities and other members of the investing community. These activities include increasing attention and demands for action related to climate change and energy transition matters, such as promoting the use of substitutes to fossil fuel and encouraging the divestment of investments in the oil and gas industry, as well as pressuring lenders and other financial services companies to limit or curtail activities with oil and gas companies. If investors or financial institutions shift funding away from companies in the oil and gas industry, the Company’s access to and costs of capital or the market for the Company’s securities may be adversely impacted.

The Company relies on a variety of capital sources to operate its business and fund capital expenditures, including internally generated cash from operations, short-term borrowings under its line-of-credit, proceeds from the issuance of additional shares of its common stock and other sources. Access to a line-of-credit is essential to provide seasonal funding of natural gas operations and provide capital budget bridge financing. Access to capital markets and other long-term funding sources is important for refinancing and capital outlays. The ability of the Company to secure longer-term financing and to maintain and renew its line-of-credit is critical to operations. Adverse market trends, market disruptions or deterioration in the financial condition of the Company could increase the cost of borrowing, restrict the Company's ability to issue additional shares of its common stock or otherwise limit the Company’s ability to secure adequate funding.

The Company is subject to federal and state income taxes as prescribed by the laws within the United States. Significant judgments are required in determining the provisions for income taxes. Our total income tax expense could be affected by changes in tax rates in various jurisdictions, changes in the valuation of deferred tax assets and liabilities or changes in tax laws or their interpretation. In preparing its tax provisions and returns, the Company must make calculations and assumptions regarding tax treatment of various transactionstransactions, including the applicability of tax credits. The Company’s tax returns are subject to examination by the IRS and state tax authorities as disclosed in Note 9 of the consolidated financial statements. Although the Company utilizes the assistance of tax professionals in the preparation of its tax returns, therethe canfinal determination of tax examinations and any related litigation could be nomaterially assurancedifferent asthan towhat the outcome of these examinations. If the ultimate determination from an examination results in additional taxes above the amountis reflected in itshistorical financialincome statements,tax provisions and accruals. If a taxing authority disagrees with the positions we have taken, the Company maycould record anyface additional income tax expenses as may be requiredliability, including any interest and penaltiespenalties, thatwhich mightcould result.adversely affect our financial results.

Resources is an energy services company primarily engaged in the regulated sale and distribution of natural gas to approximately 62,500 residential, commercial and industrial customers in Roanoke, Virginia, and the surrounding localities, through its Roanoke Gas subsidiary. Midstream, a wholly owned subsidiary of Resources, is a less than 1% investor in both the MVPMVP, Southgate and Southgate.Boost. More information regarding the investment in MVP is provided below and under the Equity Investment in Mountain Valley Pipeline section.

Beginning January 1, 2023, Roanoke Gas implemented interim, non-gas base rates designed to provide $8.55 million in additional annual revenues in response to higher operating costs and to recover its investment in non-SAVE related projects since the prior non-gas base rate increase in fiscal 2019. Revenues from the SAVE Plan and Rider were incorporated into the interim, non-gas base rates. On December 19, 2023, the SCC issued a final order approving a non-gas base rate increase of $7.45 million. The order also directed Roanoke Gas to refund the excess revenues collected during the time the interim rates were in effect with interest. Refunds to customers, which were accrued in fiscal 2023 and reflected in regulatory liabilities, were made in February 2024. On February 2, 2024, primarily in response to continued inflationary pressures, Roanoke Gas filed for a non-gas base rate increase of $4.33 million. The filing also reflected an increase in the Company's authorized return on equity from 9.44% to 10.35%. The new interim non-gas base rates went into effect for customer billings on or after July 1, 2024, subject to refund. On October 16, 2024, the Company reached a settlement with the SCC staff on all outstanding issues in the case. Under the terms of the settlement, the Company agreed to an annual incremental revenue requirement increase of $4.08 million based on a return on equity of 9.90%. On April 10, 2025, the SCC issued a final order approving the settlement in its entirety. The order also directed Roanoke Gas to refund the excess revenues collected during the time the interim rates were in effect with interest. The refunds to customers, which had previously been accrued as a regulatory liability, were made to customers in May 2025.

As the Company’s business is seasonal in nature, volatility in winter weather and the commodity price of natural gas can impact the effectiveness of the Company’s rates in recovering its costs and providing a reasonable return for its shareholders. In order to mitigate the effect of weather variations and other factors not provided for in the Company's base rates, Roanoke Gas has certain approved rate mechanisms in place that help provide stability to customer bills and earnings, adjust for volatility in the price of natural gas and provide a return on qualified infrastructure investment. These mechanisms include the SAVE Rider, WNA, ICC, RNG Rider and PGA.

The SAVE Plan and Rider provides the Company with a mechanism through which it recovers costs related to SAVE qualified infrastructure investments on a prospective basis, until such time a formal rate application is filed incorporating these investments in non-gas base rates. The SAVE Plan and Rider were reset effective January 1, 2023, when the recovery of all prior SAVE Plan investment was incorporated into the new non-gas base rates. Roanoke Gas filed and received approval from the SCC for aan newupdated annual SAVE Plan and Rider withrate newwhich ratesbecame placed into effect oneffective October 1, 2023,2024. and asAs a result,result of the updated SAVE Rider, SAVE Plan revenues declinedincreased to approximately $1,588,000 in fiscal 2025 from approximately $461,000 in fiscal 2024 from approximately $1,104,000 in fiscal 2023.2024. Roanoke Gas filed and received approval from the SCC for an updated annual SAVE Rider rate to become effective October 1, 20242025 that will result in approximately $1,389,000$2,610,000 of SAVE-related revenues during fiscal 2025.2026. See Note 4 of the consolidated financial statements for additional information regarding the SAVE Plan and Rider.

The Company also has an approved rate structure that mitigates the impact of financing costs of its natural gas inventory. Under this rate structure, Roanoke Gas recognizes revenue by applying the ICC factor, based on the Company’s weighted-average cost of capital, including interest rates on short-term and long-term debt, and the Company’s authorized return on equity, to the average cost of natural gas inventory during the period. Total ICC revenues decreased from approximately $967,000 in fiscal 2023 to $728,000 in fiscal 2024 to $587,000 in fiscal 2025 due to lower natural gas commodity prices during the 20232024 summer storage injection season resulting in a lower average cost of natural gas in storage. The average price of gas in storage during fiscal 2025 declined by 12% compared to fiscal 2024, while the average price of gas in storage at September 30, 20242025 declinedincreased by 23%5% compared to the same period last year. Accordingly,If fiscalnatural 2025gas prices remain at or higher than the prior year, the average dollar balance of gas in storage may increase based on current storage levels and due to an increased ICC factor from the prior year may lead to higher ICC revenues arein expectedfiscal to continue to remain below the prior year's levels.2026.

In March 2023, Roanoke Gas began the operation of the RNG facility to produce commercial quality biogas for delivery into its distribution system through a cooperative agreement with the Western Virginia Water Authority. With SCC approval, Roanoke Gas is allowed to recover the costs associated with the investment in RNG facilities and related operating costs through an RNG Rider added to customer bills. The customer benefits from this program through the monetization of environmental credits generated through RNG production, in which these credits are returned to customers through the RNG Rider. Total RNG revenue increased from approximately $712,000 in fiscal 2023 to $1,629,000 in fiscal 2024 asto the facility was operational for a full twelve months$1,760,000 in thefiscal current year compared to seven months in the prior year.2025. See Note 4 of the consolidated financial statements for more information on RNG.

Natural gas commodity, delivery and storage capacity costs constitute the single largest expense of the Company, representing 53%55% of fiscal 20242025 total operating expenses. After peaking in December 2022, natural gas commodity prices decreased significantly throughfor the remainder of fiscal 2023 and through fiscal 2024.2025. The decline in prices was primarily due to improved supply availability resulting from a warm winter season. Roanoke Gas recovers natural gas costs through the PGA mechanism as noted above; however, in times where commodity prices rapidly increase, the timing of recovery may lag. Increasing natural gas prices, especially in relation to other energy options, may lead to reductions in energy consumption through customer conservation or fuel switching. In addition, there is potential for higher bad debts related to customers' inability to pay higher natural gas bills.

Inflation,The dueCompany continues to supplyexperience chaininflation delays,over laborthe shortages2% level targeted by the Federal Reserve. Inflation levels in health care spending, certain types of insurance, contracted services and limitedIT availabilityservice ofcosts, criticalas supplies,well amongas other factors,items, affectscontinue to put upward pressure on the CompanyCompany's through increases in non-gas expenses such as labor, employee benefits, materials and supplies, contracted services, corporate insurance and other areas.expenses. The Company recovers non-gas related costs through the non-gas portion of its tariff rates, which are adjusted through a non-gas base rate application. Unlike the rate adjustments for the gas portion of rates which are done administratively, the non-gas base rate application process can result in an inherent lag in non-gas expense recovery. Therefore, authorized non-gas base rates may not keep pace with rising costs during inflationary periods. Management regularly evaluates the Company's operations, economic conditions and other factors to assess the need to apply for a non-gas base rate adjustment. Accordingly, managementon December 2, 2025, the Company filed a non-gas base rate application inwith Februarythe 2024SCC to incorporateincrease increasedrevenues expenseby levels$4.3 frommillion continued inflationary pressures since the last non-gas base rate application. These new non-gas base rates were implemented effective July 1, 2024, subject to refund. See Note 4 of the consolidated financial statements for more information, including reaching settlement with SCC staff.annually.

The analysis on the results of operations is based on the consolidated operations of the Company, which are primarily associated with the utility segment. Additional segment analysis is provided when Midstream's investment in affiliates represents a significant component of the comparison. Net income increased by $461,614$1,519,074 from the prior year primarily due to AFUDCthe implementation of higher non-gas base rates and record natural gas deliveries, as well as lower post-retirement benefit costs, partially offset by lower WNA revenues and lower equity earnings from the MVP andas the implementationproject oftransitioned newfrom non-gasconstruction baseinto rates effective July 1, 2024, partially offset by increased inflationary pressures on operating expenses and higher interest rates.service.

Gross utility margin increased over the prior fiscal year primarily as a result of the implementation of new non-gas base rates, net of SAVE, WNArates and RNGincreases revenue,in SAVE revenues, slightly offset by the reductionsreduction in ICC revenues. WhenThe adjustedvolumetric formargin, WNA,net of the volumetric marginWNA, increased by approximately $2,430,000.$2.8 Basemillion charge revenues increased by approximately $522,000primarily due to the new non-gas base raterates increase.and Theincreases RNGin Ridertransportation and interruptible volumes. As previously discussed, the SAVE Plan contributed an additional $917,000$1,127,000 to margin, as it was operational for all twelve months of fiscal 2024 compared to seven months during fiscal 2023, andwhile ICC revenuerevenues declineddecreased by $239,000approximately $141,000 due to lower cost and volumes of gas in storage.

Operations and Maintenance Expense - Operations and maintenance expense increased by $2,450,764,$1,556,674, or 15%,8%, over the prior year primarily due to inflationary effects on personnel costs,costs professionaland contracted services, RNG-related costs associated to operate and maintainbad thedebt RNG facility and lower capitalized overheads.expense. Personnel costs and contracted services increased by approximately $1,094,000$969,000 due to increased staffing and the inflationary impact on salaries and benefitsbenefits. as well as awards of restricted stock. During fiscal 2023, no performance-based restricted stock was awarded, but was reinstated in fiscal 2024. Professional servicesRNG expenses increased approximately $270,000$231,000 primarily due to increasedincreases externalin audit fees, actuarial services, recruiting costselectric and ITtelemetering support.charges. Further,Bad costsdebt associated with the RNG facilityexpense increased approximately $299,000, as the facility was only operational during seven months of the prior year as compared to all twelve months in the current year. Total capitalized construction overheads declined by approximately $429,000 compared to the prior year primarily$170,000 due to ahigher reductionbills infrom directcolder constructionweather expendituresand relatedmore toinactive theaccounts RNGresulting project,from whichnon-pay wascustomer completedturnoffs. inIncreased fiscal 2023. Corporatecorporate insurance premiums accounted for much of the remaining cost increase.

Depreciation and Amortization - Depreciation and amortization expense increased by $753,416,$952,547, or 8%,9%, corresponding to a similar increase in net additions to depreciable utility property. Increases in fixed assets with shorter useful lives during the current fiscal year resulted in depreciation expense increasing slightly more than the 6% increase in utility property.

Equity in Earnings of Unconsolidated Affiliate - The equity in earnings of the MVP investment increaseddecreased by $1,766,881$617,239, associatedor with the recognition of AFUDC as a result of MVP construction activities continuing through May 2024.16%. With the MVP in service, the Company now recognizes its share of operational earnings from the MVP, favorably adjusted for the amortization of a basis difference that arose when the Company recorded an other-than-temporary impairment of its investment in 2022. These in-service earnings did not fully replace the amount of AFUDC recognized while construction activities were ongoing during the first eight months of fiscal 2024. See Note 5 of the consolidated financial statements for additional information related to the MVP.

RoanokeInterest Gas'Expense - Total interest expense remained relatively flat over the prior year, increasing slightly by $38,626, or 1%, primarily due to higher borrowing levels. Total average debt outstanding during fiscal 2025 increased by $484,454,2% orfrom 15%,fiscal as2024. Roanoke Gas' total average debt outstanding increased by approximately $5,600,000$1,346,000 associated with net borrowings under the Company's line-of-credit.line-of-credit, Thewhile Midstream's total average interestdebt rateoutstanding increased slightlyby fromapproximately 3.51%$1,441,000 during the year. There were minimal fluctuations in fiscalthe 2023weighted-average to 3.72% in fiscal 2024. All of Roanoke Gas' long-term debt carry fixedinterest rates eitherbetween duethe to fixed rate notes or with variable rate debt that has a corresponding swap agreement.periods. See Note 6 and 7 of the consolidated financial statements for more information on the Company's debt.

Cash and cash equivalents decreasedincreased by approximately $1,426,000 in fiscal 2025 compared to a decrease of approximately $618,000 in fiscal 2024 compared to $3.4 million in fiscal 2023.2024. The following table summarizes the categories of sources and uses of cash:

Investing activities primarily consist of expenditures related to Roanoke Gas' utility property, which includes replacing aging natural gas pipe with new plastic or coated steel pipe, improvements to the LNG plant and gas distribution system facilities and expansion of its natural gas system to meet the demands of customer growth. New customer demand for natural gas continues to be steady and therefore extending the natural gas distribution system within its service territory is also a priority. Roanoke Gas' expenditures were approximately $22.1$20.7 million and $25.3$22.1 million in fiscal 20242025 and 2023,2024, respectively. The $3.2$1.4 million decrease in expenditures is primarily due to higher prior-year investment for the RNGMVP project,gate stations, which waswere placed ininto service in Marchfiscal 2023.2024. Roanoke Gas renewed 4.2 miles of main and 311 service lines and 5.4 miles of main and 412 service lines and 5.7 miles of main and 452 service lines in fiscal years 20242025 and 2023,2024, respectively. WithUnder the recentSCC approval of its newapproved SAVE Plan and Rider, the Company is continuing its focus on SAVE infrastructure replacement projects, including the replacement of pre-1973 first generation plastic pipe. New customer demand for natural gas continues to be strong and therefore extending the natural gas distribution system within its service territory is also a priority. Roanoke Gas’ capital expenditures included costs to extend natural gas distribution mains and services to 521594 new customers in fiscal 2024,2025, compared to 430521 new customers in fiscal 2023.2024.

Investing cash flows also reflects the fiscal 20242025 funding of approximately $18,000$76,000 for Midstream's participation in the LLC, downup from theapproximately $2.1 million$18,000 in fiscal 2023. Midstream ceased future participation in capital calls following its May 2023 funding payment based on an agreement with the LLC's managing partner. Midstream continues to be invested in the LLC; however, its ownership percentage declined as it did not make additional investments.2024. Now that the MVP is in service, Midstream will incurbe normalrequired to make periodic capital investment related to ongoing MVP operations requirements and system improvements, in which it will again participate.improvements. Midstream has and will continue to make capital investments in Southgate.Southgate and Boost. The targeted timing for completion of the Southgate project is 2028.2028 and the Boost project is 2029.

Financing activities generally consist of borrowings and repayments under credit agreements, issuance of common stock and the payment of dividends. Net cash flows providedused byin financing activities were approximately $4.0$6.8 million and $200,000 in fiscal 20242025, andcompared 2023,to respectively.$4.0 million in net cash flows provided by financing activities in fiscal 2024. The $3.8$10.8 million increasedecrease in financing cash flows is primarily attributable to net borrowings of $6.8approximately million$751,000 under Roanoke Gas' line-of-credit during fiscal 2024 compared to $4.3 million in net borrowings in the prior year. Additionally, Midstream borrowed a net amount of $680,000 during fiscal 2024 from its amended credit facility2025 compared to net repaymentsborrowings of $6.8 million in the same period last year. In addition, during fiscal 2025, Resources issued a total of 88,409 shares of common stock, primarily from DRIP activity, resulting in net proceeds of approximately $196,000$1.8 inmillion. No shares were issued through the priorATM year.program during fiscal 2025. During fiscal 2024, the Company realized $4.7 million from the issuance of 234,645 shares through the ATM program and DRIP activity compared to $3.9 million received from the issuance of 194,719 shares from those same activities, as well as the exercise of stock options, during the prior year.activity. Cash outflows for dividend payments were $8.0$8.5 million as the annualized dividend rate increased from $0.79$0.80 to $0.80$0.83 per share and total outstanding shares increased as a result of the stock issuance activity. The Company’s consolidated capitalization was 43.7% equity and 56.3% long-term debt at September 30, 2025, exclusive of unamortized debt expense. This compares to 44.1% equity and 55.9% long-term debt at September 30, 2024, exclusive of unamortized debt expense. This compares to 44.4% equity and 55.6% long-term debt at September 30, 2023.2024.

The currentCurrent interest rate environmenttrends may result in lower interest costs associated with the Company's variable rate debt.debt in 2026.

Management regularly evaluates the Company’s liquidity through a review of its available financing resources and its cash flows. Resources maintains the ability to raise equity capital through its ATM program, private placement or other public offerings. Roanoke Gas has a term note in the principal amount of $15 million coming due in August 2026. Management believes Roanoke Gas has access to sufficient financing resources to meet its cash requirements for the next year, including cash from operations and the line of creditcredit. andRoanoke theGas twomay privatealso shelfadjust facilities.capital Thespending firstas shelfnecessary, facilityif providessuch fora theneed issuancewould of up to $40 million in unsecured notes in addition to the $28 million previously issued. This shelf agreement is scheduled to expire on December 6, 2025. The second facility provides for the issuance of up to $70 million in unsecured notes during its current term, which expires September 30, 2025.arise.

Roanoke Gas may also adjust capital spending as necessary, if such a need would arise. With the MVP now in service, Midstream's future cash requirements will relate to regular monthly operating expenses, debt service and capital contributions. The Company received itsfour firstquarterly cash distributiondistributions from MVP ofin fiscal 2025 totaling approximately $800,000$3.6 in October 2024,million, and should receive similar quarterly distributions quarterly.going forward. On MarchSeptember 6,5, 2024, Midstream refinanced its Promissory Notes with one lender, increased the capacity of its $23 million credit facility to $25 million and extended the maturity date to December 31, 2025. Further, on May 2, 2024,2025, Midstream established a new $9$53.6 million lineterm note with two banks, which refinanced and replaced all of creditMidstream's facilityoutstanding thatdebt. This term note matures on MaySeptember 2,5, 2026.2032. WithAlso theseon proceeds,September 5, 2025, Midstream paidentered ininto fulla new Loan Agreement for the $9MVP Southgate extension and MVP Boost expansion that can be drawn to principal amounts of $1.85 million and $3.65 million, respectively. These loans mature on September 5, 2030, at which time the outstanding principal balance on itseach note payableis that matured on June 1, 2024.due. With the extension of its original credit facility and the establishment of the new creditterm facility,note, Midstream's total debt repaymentprincipal payments over the succeeding 12 months is $800,000 in principal payments.$2,846,018. Management believes that it will be able to meet Midstream's cash requirements over the ensuing 12-month period with availability on the Southgate and Boost Loan Agreements and its quarterly cash distributions from MVP.

The Company opted to not utilize the ATM program for the year ended September 30, 2025, although it remains in place. Resources issued 129,164 shares of common stock for $2,635,200, net of $67,569 in fees, under the ATM program for the year ended September 30, 2024. For the year ended September 30, 2023, Resources issued 127,852 shares of common stock for $2,713,020, net of $69,565 in fees, under the ATM program.

MidstreamThe Company owns a less than 1% equity investmentinterest in the LLC that owns and operates the MVP.MVP, as defined in its operating agreement. The Company accounts for its interest in the LLC under the equity method of accounting given the LLC maintains specific ownership accounts for each investor, and also considering the Company's rights under the LLC management agreement and the Company's involvement as a customerstakeholder of the MVP. The Company has been using the equity method since the inception of its investment in fiscal 2016. Following receipt of authorization from the FERC, the MVP entered commercial operation on June 14, 2024 and became available for interruptible or short-term firm transportation service. On July 1, 2024, the MVP commenced long-term firm capacity obligations. Midstream is also a less than 1% investor, accounted for under the cost method, in Southgate, which is in the design and permitting phase. Completion of the Southgate pipeline is targeted for June 2028.

From inception through May 2024, earnings from the LLC were primarily attributable to AFUDC income. With the MVP now in operation, the Company recognizes its share of earnings from the LLC, favorably adjusted for a basis difference between the Company's proportional share of assets and its carrying value that arose when the Company recorded an other-than-temporary impairment of its investment in 2022. This basis difference amortization is a favorable non-cash adjustment over the operational life of the MVP, or 40 years. ForDuring fiscal 20242025 and 2023,2024, the Company recorded equity in earnings of consolidated affiliates of $3.9approximately $3.2 million and $2.1$3.9 million, respectively, whichwith includedthe $3.02024 millionamounts andbeing $2.1primarily millionderived from AFUDC. The CompanyLLC participatesbegan to return excess cash in fiscal 2025. Midstream received quarterly cash distributions byof its share from the LLC,LLC thetotaling firstapproximately of$3.6 million during fiscal 2025, which was ina Octoberreturn 2024.on its invested capital. Future quarterly distributions are expected to be of a similar magnitude. The Company'sCompany shareis wasusing approximatelythis $800,000.cash to pay interest and other expenditures related to Midstream. The Company refinanced all of the debt supporting its investment in the MVP in September 2025, as described in the liquidity section above.

Pension and Postretirement Benefits - The Company offers a pension plan and a postretirement plan to eligible employees. The expenses and liabilities associated with these plans, as disclosed in Note 12 of the consolidated financial statements, are based on numerous assumptions and factors, including provisions of the plans, employee demographics, contributions made to the plan, return on plan assets and various actuarial calculations, assumptions and accounting requirements. Demographic assumptions include projections of future mortality rates, pay increases and retirement patterns, as well as projected health care costs. In regard to the pension plan, specific factors include assumptions regarding the discount rate used in determining future benefit obligations, expected long-term rate of return on plan assets, compensation increases and life expectancies. Similarly, the postretirement medical plan also requires the estimation of many of the same factors as the pension plan in addition to assumptions regarding the rate of medical inflation and Medicare availability. Actual results may differ materially from the results expected from the actuarial assumptions due to changing economic conditions, differences in actual returns on plan assets, different rates of medical inflation, volatility in interest rates and changes in life expectancy. Such differences may result in a material impact on the amount of expense recorded in future periods or the value of the obligations on the consolidated balance sheet.

In selecting the discount rate to be used in determining the benefit liability, the Company utilized the FTSE Pension Discount Curve, which incorporates the rates of return on high-quality, fixed-income investments that corresponded to the length and timing of benefit streams expected under both the pension plan and postretirement plan. The Company used a discount rate of 4.83%5.29% and 5.16% for valuing both its pension plan liability and postretirement plan liabilitiesliability, respectively, at September 30, 2024.2025. These discount rates represent aan decreaseincrease from the 5.63%4.83% rate used for valuing the corresponding liabilities for both the pension plan and postretirement plan used for valuing the corresponding liabilities at September 30, 2023.2024. The decreaseincrease in discount rates reflectcorresponds to the Federalmarket Reserve'sreactions easingto ofthe interestcontinuing ratesinflationary inpressures 2024on the financial markets and general long-term rate decline.economy. The yield on the 30-year Treasury increased from 3.79%4.14% at September 30, 20222024 to 4.73% at September 30, 2023 and decreased to 4.14% at September 30, 2024.2025. Corporate bond rates experienced a smaller increase as credit spreads have narrowed. The rise in the discount rates through 2023 was the primary factor in the reduction of the benefit obligations for both the pension and the postretirement plan. Mortality assumptions were based on the PRI-2012 Mortality Table with improvements projected generational using Projection Scale MP-2021 for the current year valuation.

The Company has focused on minimizing the financial risk associated with these plans. With the soft freezes of both the pension and postretirement plans, future liability growth associated with participant service and compensation has been limited. Since January 2017, when the pension plan froze access to new employees, the target asset allocation has transitioned from 60% equity and 40% fixed income to 25% equity and 75% fixed. During the same period, the fixed income portion of the plan was transitioned to an LDI approach, with the fixed income assets invested in securities with a duration that corresponds to the duration of the corresponding liability. This synchronization of the pension assets with the pension liabilities has reduced volatility in the funded status of the plan. This is evidenced by the relative stability of the funded status of the pension plan at September 30, 20242025 and 20232024 with a funded ratio of 104%103% and 100%,104%, respectively. The 25% allocation to equity investments provides asset growth potential to offset increases in the pension liability related to those employees continuing to accrue benefits. Management will continue to evaluate the investment allocation as the liabilities mature and make adjustments as necessary.

The Company annually evaluates the long-term rate of return on its targeted investment allocation model, as well as the overall asset allocation of its benefit plans, and reviews both plans' potential long-term rate of return assumptions with its investment advisors to determine the rates used in each plan's actuarial calculations. The long-term rates of return increased slightly from 4.50%4.95% in fiscal 2024 to 4.95%5.75% for fiscal 2025 for both the pension plan and from 4.21% in fiscal 2024 to 4.95% for fiscal 2025 for the postretirement plan. Management will continue to evaluateevaluates the return assumptions and asset allocation and adjustadjusts both as market conditions warrant.

Derivatives - The Company may hedge certain risks incurred in its operation through the use of derivative instruments. The Company applies the requirements of ASC 815, Derivatives and Hedging, which requires the recognition of derivative instruments as assets or liabilities in the Company’s consolidated balance sheet at fair value. In most instances, fair value is based upon quoted futures prices for natural gas commodities and interest rate futures for interest rate swaps. Changes in the commodity and futures markets will impact the estimates of fair value in the future. Furthermore, the actual market value at the point of realization of the derivative may be significantly different from the values used in determining fair value in prior financial statements. The Company had foursix interest-rate swaps outstanding at September 30, 20242025 related to its variable rate notes.notes, compared to four at September 31, 2024. The corresponding fair value of thesethe swaps is reflected on the consolidated balance sheets as of September 30, 20242025 and 2023.2024. A 25 basis point decrease andor increase on the yield curve would result in aan $228,248approximately $600,000 corresponding decrease andor $226,748 increase, respectively,increase in the fair value of the interest rate swaps on the balance sheet. See Notes 1 and 8 to the consolidated financial statements for additional information regarding the swaps.

There have been no material changes to the risk factors previously disclosed in Resources' Annual Report on Form 10-K for the year ended September 30, 2025; oneand riskon factorthe hasMarch been31, revised2026 asForm follows:10-Q.

This report contains forward-looking statements that relate to future transactions, events or expectations. In addition, Resources may announce or publish forward-looking statements relating to such matters as anticipated financial performance, business prospects and closures, investments, inflation, ratemaking and other regulatory actions, debt refinancing, technological developments, new products, research and development activities, weather variations, operational impactsimpacts, including those related to the LNG facility, and similar matters. These statements are based on management’s current expectations and information available at the time of such statements and are believed to be reasonable and are made in good faith. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements. In order to comply with the terms of the safe harbor, the Company notes that a variety of factors could cause the Company’s actual results and experience to differ materially from the anticipated results or other expectations expressed in the Company’s forward-looking statements. The risks and uncertainties that may affect the operations, performance, development and results of the Company’s business include, but are not limited to, those set forth in the following discussion and within Item 1A “Risk Factors” in the Company’s 2025 Annual Report on Form 10-K, as well as an updated risk within Item 1A "Risk Factors" in Partthe IICompany's below.March 31, 2026 Form 10-Q. These factors are difficult to predict and many are beyond the Company’s control. Accordingly, while the Company believes its forward-looking statements to be reasonable, there can be no assurance that they will approximate actual experience or that the expectations derived from them will be realized. When used in the Company’s documents or news releases, the words “anticipate,” “believe,” “intend,” “plan,” “estimate,” “predict,” “target,” “expect,” “objective,” “projection,” “potential,” “forecast,” “budget,” “assume,” “indicate” or similar words or future or conditional verbs such as “will,” “would,” “should,” “can,” “could,” “may,” or “might” are intended to identify forward-looking statements.

The three-month and six-monthnine-month earnings presented herein should not be considered as reflective of the Company’s consolidated financial results for the fiscal year ending September 30, 2026. The total revenues and margins realized during the first sixnine months reflect higher billings due to the weather-sensitive nature of the natural gas business.

The SAVE Plan and Rider provides the Company with a mechanism through which it recovers costs related to qualified SAVE infrastructure investments on a prospective basis, until a rate application is filed incorporating these investments in non-gas base rates. Roanoke Gas filed and received approval from the SCC for an updated annual SAVE Rider rate which became effective October 1, 2025. As a result of the updated SAVE Rider, SAVE Plan revenues increased by approximately $261,000$242,000 and $532,000,$774,000, respectively, for the three-month and six-monthnine-month periods ended MarchJune 31,30, 2026 compared to the same periods last year. The updated SAVE Rider is expected to result in approximately $2.61 million of annualized SAVE-related revenues during fiscal 2026. On June 30, 2026, Roanoke Gas filed for approval of an updated annual SAVE Rider to become effective October 1, 2026. The proposed SAVE Rider revenue requirement of $3.79 million is designed to recover the costs associated with prior years' SAVE-eligible investments that occurred under the current SAVE Plan and an estimated $9.26 million of SAVE-eligible investment during fiscal 2027. The revenue requirement also included an adjustment for under-recovered costs incurred during the prior year. The Company expects final resolution from the SCC in September 2026. Additional information regarding the SAVE Plan and Rider is provided in Note 4 of the condensed consolidated financial statements.

The WNA mechanism reduces the volatility in earnings due to the variability in temperatures during the heating season. The WNA is based on the most recent 30-year temperature average and provides the Company with a level of earnings protection when weather is warmer than normal and provides its customers with price protection when weather is colder than normal. The WNA allows the Company to recover from its customers the lost margin (excluding gas costs) from warmer-than-normal weather and correspondingly requires the Company to refund the excess margin earned for colder-than-normal weather. The WNA mechanism used by the Company is based on a linear regression model that determines the value of a single heating degree day and thereby estimates the revenue adjustment based on weather variance from normal. Any billings or refunds related to the WNA are completed following each WNA year, which extends for the 12-month period from April to March. For the three and nine months ended MarchJune 31,30, 2026, the Company accrued approximately $298,000$383,000 and $361,000, respectively, in additional revenues under the WNA model for weather that was 2%18% and 1% warmer than normal, compared to reducing revenues by approximately $27,000$493,000 forand weather that was in line with normal for the corresponding period last year. For the six months ended March 31, 2026, the Company reduced revenues by approximately $21,000 for weather that was in line with normal, compared to approximately $473,000$966,000 in additional revenues for weather that was 2%22% and 4% warmer than normal for the corresponding periodperiods last year. The adjusted WNA balance for the 12-month period ended March 31, 2026 was approximately $483,000,$481,000, whichand willwas becollected billed tofrom customers during May 2026.

The Company has an approved rate structure to mitigate the impact of the financing costs of its natural gas inventory. Under this rate structure, Roanoke Gas recognizes revenue by applying the ICC factor, based on the Company’s weighted-average cost of capital, including interest rates on short-term and long-term debt, and the Company’s authorized return on equity, to the average cost of natural gas inventory during the period. Total ICC revenues decreased nominally for both the three-month and six-monthnine-month periods ended MarchJune 31,30, 2026 compared to the corresponding periods last year. While the average price of gas in storage fluctuated nominally for the six-monthnine-month period ended MarchJune 31,30, 2026 compared to the same period in the prior year, the average price of gas in storage decreased by 4%8% during the secondthird quarter of fiscal 2026 compared to the secondthird quarter of fiscal 2025. If natural gas prices remain at or continue to decline as compared to the prior year, coupled with possible reduced storage levels at the LNG facility, the average dollar balance of gas in storage is expected to decrease, leading to lower ICC revenues in fiscal 2026.2026 and 2027.

Roanoke Gas operates an RNG facility, through a cooperative agreement with the Western Virginia Water Authority, to produce commercial quality RNG for delivery into its distribution system. Roanoke Gas is allowed to recover the costs associated with the investment in its RNG facilitiesfacility and the related operating costs through an RNG Rider added to customer bills that was approved by the SCC in 2023 and updated annually. Customers receive the benefit of environmental credits generated through the production of RNG. Roanoke Gas recognized approximately $450,000$462,000 and $934,000,$1,396,000, respectively, in RNG revenue for the three and sixnine months ended MarchJune 31,30, 2026 compared to approximately $429,000$479,000 and $817,000$1,296,000 for the corresponding periods in the prior year.

The cost of natural gas, which is a pass-through cost, is independent of the Company's non-gas rates. Accordingly, the Company's approved billing rates include a component designed to allow for the recovery of the cost of natural gas. This rate component, referred to as the PGA, allows the Company to pass alongthrough to its customers increases and decreases in natural gas costs through a quarterly filing, or more frequent if necessary, once SCC staff approval is received. As actual costs will differ from the projections used in establishing the PGA rate, the Company will either over-recover or under-recover its actual gas costs during the period. The difference between actual costs incurred and costs recovered through the application of the PGA is recorded as a regulatory asset or liability. At the end of the annual deferral period, the balance is amortized over a succeeding 12-month period through the ensuing non-gas rate component. Due to the extended and extreme cold weather experienced across the eastern half of the United States during Winter Storm Fern, natural gas prices spiked from less than $4 per DTH to well over $30 per DTH at the end of January and into February 2026. As such, the Company adjusted the PGA rate effective February 2026 to offset the increased under-recovery of gas costs, which are anticipated to be collected from customers over the ensuing 12 to 18 months.

Three Months Ended MarchJune 31,30, 2026:

Net income increased by $1,068,282$20,488 for the three months ended MarchJune 31,30, 2026, compared to the same period last year, primarily due to implementation of higher non-gas base rates effective January 1, 2026.year.

Gross utility margin increased 7%8% from the same period last year primarily as a result of the aforementioned increases in non-gas base rates, asdelivered wellvolumes as increasedand SAVE and RNG revenues, which contributed $611,000 and $298,000, respectively. As discussed in the Overview section, the WNA model adjusts for the impact of variability of temperatures during the heating season.revenues. The WNA model calculates what the corresponding volumes would be if temperatures were equivalent to the 30-year normal during each period and adjusts for the difference in margin from normal. In applying the WNA model to both the current and prior periods, the volumetric margin, inclusive of the WNA, increased by approximately $1.1 million$533,000 due to weather that was 2%18% warmer than normal.

Operations and maintenance expenses increased $295,775,$534,328, or 6%.12%. The Company continues to experience inflation over the 2% level historically targeted by the Federal Reserve. Inflation levels in health care benefits, certain types of insurance, contractedprofessional services and IT service costs, as well as other items, continue to put upward pressure on the Company's expenses. ContractedPersonnel servicescosts increased by approximately $86,000 also$180,000 due to increased staffing and the inflationary pressuresimpact ason wellsalaries asand increased customer turn-ons.benefits. Capitalized construction overheads declined by approximately $124,000$125,000 dueas there was no capitalization associated with LNG liquefaction during the quarter. See Note 14 of the consolidated financial statements for additional information related to athe reductionLNG in Roanoke Gas capital projects as a result of winter weather.facility. Higher corporate insurance premiums and professional services expenses accounted for much of the remaining cost increase.

Depreciation expense increased by $214,337,$161,761, or 8%,6%, corresponding to a similar increase in investments in depreciable utility property. Increases over the last year in capitalized software, with shorter useful lives, resulted in depreciation expense increasing slightly more than the 5% increase in the average gross utility property balance from the prior year quarter.

Other income, net increased by $228,788,$84,965, or 49%,35%, primarily due to increasedactuarially interest income anddetermined postretirement income,benefit partiallyplan offset by a decrease in revenue sharing related to the renewed asset management agreement.income.

Interest expense decreasedincreased by $44,437,$38,996, or 3%, as the weighted-average interest rate on totalaverage debt decreasedoutstanding from 4.33% duringfor the second quarter ofincreased fiscalby 2025approximately 5% compared to 4.10%the same period in the currentprior quarter.year. Midstream's interest expense decreased by $89,017,$66,044, or 13%,10%, as the total average debt outstanding decreased by approximately $1,586,000$1,197,000 as a result of principal payments made on term notes, along with the weighted-average interest rate decreasing from 5.06%5.10% during the secondthird quarter of fiscal 2025 to 4.53%4.72% in the current quarter. Roanoke Gas' interest expense increased by $44,580,$105,040, or 5%,13%, as total average debt outstanding increased by approximately $3,870,000$7,573,000 associated with higher net borrowings under the Company's line-of-credit. Roanoke Gas' weighted-average interest rate remained relatively flatincreased from 3.82% in the secondthird quarter of fiscal 2025 to 3.96% in the current quarter. See Notes 6 and 7 of the consolidated financial statements for more information on the Company's debt.

SixNine Months Ended MarchJune 31,30, 2026:

Net income increased by $681,458$701,946 for the sixnine months ended MarchJune 31,30, 2026, compared to the same period last year, primarily due to the aforementioned implementation of higher non-gas base rates thisin quarter,January 1, 2026, lower interest expense and income taxes, slightly offset by continued inflationary pressures on operating costs.

Total operating revenues for the sixnine months ended MarchJune 31,30, 2026, compared to the same period last year, increased by approximately 19%15% forprimarily similardue reasonsto ashigher previouslynatural discussedgas forcommodity prices, the quarter.implementation of a non-gas base rate increase and increased SAVE revenues. Total natural gas costs increased by 36%26% compared to the same period last year, primarily due to pipeline capacity charges increasing over $2.3$1.9 million, which corresponds to a 38%29% increase in the gas cost component included in the total customer billing rate. The average commodity price per dekatherm for the first halfnine months of fiscal 2026 was $5.10$4.84 compared to $3.70$3.67 per dekatherm for the same period in the prior year. AlthoughCommodity weatherprices wasduring 3%the coldersecond thanquarter of fiscal 2026 included the effect of Winter Storm Fern. The non-gas base rate increase implemented in January 2026, which will generate approximately $3.85 million in additional annual revenues, have contributed an additional $2.0 million to non-gas volumetric revenues during the current year compared to the same period in the prior year and almost even with the 30-year normal, delivered volumes decreased 3%.year. Weather-sensitive residential and commercial volumes declined 1%, while transportation and interruptible volumes declinedincreased by 8%3% asprimarily driven by business activity of a single, multi-fuel customer that hadhas been utilizing natural gas as its primary fuel source reduced its consumption, however, the Company expects this customer's usage to return to normal levels.source. SAVE Plan revenues increased by approximately $532,000$774,000 compared to the same period in the prior year as Roanoke Gas continues to invest in qualified SAVE infrastructure projects.

Gross utility margin increased 4%5% from the same period last year primarily as a result of the aforementioned increases in non-gas base rates and gas costs, as well as increased SAVE and RNG revenues, which contributed $1.2 million and $934,000, respectively, to margin.revenues.

Operations and maintenance expenses increased $829,585,$1,363,913, or 8%.9%. The Company continues to experience inflation over the 2% level historically targeted by the Federal Reserve. Inflation levels in health care benefits, certain types of insurance, contracted services and IT service costs, as well as other items, continue to put upward pressure on the Company's expenses. Personnel costs increased by approximately $147,000$327,000 due to increased staffing and the inflationary impact on salaries and benefits. Contracted services increased by approximately $274,000$166,000 also due to inflationary pressures as well as increased customer turn-ons. Capitalized construction overheads declined by approximately $311,000$436,000 dueas there was no capitalization associated with LNG liquefaction during the current year. See Note 14 of the consolidated financial statements for additional information related to athe reductionLNG in Roanoke Gas capital projects as a result of winter weather.facility. Higher corporate insurance premiums and RNG-related costs accounted for much of the remaining increase, which were slightly offset by a decrease in professional services expenses.

Depreciation expense increased by $442,082,$603,843, or 8%,7%, corresponding to a similar increase in investments in depreciable utility property. Increases over the last year in capitalized software, with shorter useful lives, resulted in depreciation expense increasing slightly more than the 5% increase in the average gross utility property balance.

Other income, net increased by $260,441,$345,406, or 28%,29%, primarily due to additional interest income and increased postretirement benefit plan income, partially offset by a decrease in revenue sharing related to the asset management agreement.

Interest expense decreased by $153,217,$114,221, or 4%,2%, as the weighted-average interest rate on total debt decreased from 4.40%4.36% during the first sixnine months of fiscal 2025 to 4.12% in the current year. Midstream's interest expense decreased by $210,295,$276,339, or 15%,13%, as the total average debt outstanding decreased by approximately $1,460,000$1,372,000 as a result of principal payments made on term notes, along with the weighted-average interest rate decreasing from 5.22%5.18% during the first sixnine months of fiscal 2025 to 4.584.62 % in the current year. Roanoke Gas' interest expense increased by $57,078,$162,118, or 3%,6%, as total average debt outstanding increased by approximately $2,727,000$4,342,000 associated with net borrowings under the Company's line-of-credit. Roanoke Gas' weighted-average interest rate remained relatively flat from the first sixnine months of fiscal 2025 to the current year. See Notes 6 and 7 of the consolidated financial statements for more information on the Company's debt.

Income tax expense decreased by $85,803,$92,516, or 2%. The effective tax rate was 22.2%22.1% and 23.4% for the six-monthnine-month periods ended MarchJune 31,30, 2026 and 2025, respectively. The effective tax rate is below the combined statutory state and federal rate due to the amortization of excess deferred taxes and tax credits. Additionally, amortization recognition related to R&D tax creditscredit amortization and certain restricted stock-related tax deductions contributed to a further reduction toreduced the effective tax rate during the current period.

In addition, the Company produces commercial quality RNG for delivery into its distribution system and operates and maintains an LNG liquefaction, vaporization and storage tank facility to supplement heating season gas supply requirements on the coldest days (the LNG peak shaving facility). During a routine inspection in the second quarter of fiscal 2026, the Company noted damage to its LNG facility, and more specifically, to the LNG tank. The Company has hired subject mattersubject-matter experts to help assess the cause(s), andthe scope of the damage and to design possible solutions.workarounds, Whilereplacement thator workremediation. is ongoing, theThe Company believeshas confirmed that the LNG peak shaving facility iswill unlikely tonot be available in the 2026 to 20272026-2027 winter heating seasonseason. Although no natural or liquified natural gas was discovered outside of the LNG tank, analysis shows the LNG tank underwent significant stress. Further damage investigation costs could exceed $1 million, could be partially destructive in nature, and may or may not be determinative. Accordingly, the Company is developingconsidering alternatives and has not finalized its long-term plans for the LNG tank or the LNG facility, but has taken several actions to provideadd servicenatural withoutgas thissupply facility.to its distribution system, including (1) installing additional steel pipe to increase the gas flows from MVP farther into the Roanoke system, (2) contracting for additional daily supply from TCO from November 2026 through March 2027, and (3) procuring trucked LNG. Currently, the Company is unable to estimate the total cost toassociated completewith thethis assessmentevent. andThe designCompany processeshas asfully wellengaged aswith anyits investmentinsurer necessarybut todoes repairnot theyet damageknow orwhat replaceportion, theif LNGany, facility.of its spending will be covered by insurance. The Company has held numerous discussions with the SCC StaffStaff, aboutand establishingcontinues to keep them apprised of significant developments. The Company has established a regulatory asset relatedfor costs to safely empty the eventLNG fortank amountsand notevaluate coveredfuture byoptions, insurance.and will seek recovery of the regulatory asset in a future regulatory proceeding.

The Company recognizes its share of earnings from the LLC, favorably adjusted for a basis difference between the Company's proportional share of assets and its carrying value that arose when the Company recorded an other-than-temporary impairment of its investment in 2022. This basis difference amortization is a favorable non-cash adjustment over the operational life of the MVP, or 40 years. For the secondthird quarter of fiscal 2026 and 2025, the Company recorded equity in earnings of consolidated affiliates of approximately $904,000$764,000 and $801,000,$772,000, respectively. For the first sixnine months of fiscal 2026 and 2025, the Company recorded equity in earnings of consolidated affiliates of approximately $1.7$2.5 million inand both$2.4 periods.million, respectively. The Company received a quarterly cash distribution of its share from the LLC totaling approximately $641,000$971,000 and $983,000$874,000 during the secondthird quarter of fiscal 2026 and 2025, respectively, which was a return on its invested capital, and expects future quarterly distributions to be of a similar magnitude. For the first halfnine months of fiscal 2026 and 2025, quarterly cash distributions totaled $1.4$2.4 million and $1.8$2.7 million, respectively. The Company is using this cash to pay interest and other expenditures related to Midstream. The Company refinanced all of the debt supporting its investment in the MVP in September 2025, as described in the liquidity section.

Cash flows from operating activities for the sixnine months ended MarchJune 31,30, 2026 decreased by $5,364,236$5,864,403 compared to the same period last year. Under-recovered gas costs increased approximately $384,000$2.4 million during the sixnine months ended MarchJune 31,30, 2026 compared to a $5.8$4.1 million increase in over-recovered gas cost during the same period in the prior year. The fluctuation from a liability position to an asset position resulted in a decline of approximately $6.2$6.5 million in operating cash flows between periods. As previously discussed,Additionally, due to the extended and extreme cold weather experienced across the eastern half of the United States during Winter Storm Fern, natural gas prices spiked from less than $4 per DTH to well over $30 per DTH at the end of January and into February 2026. As a result, total commodity costs increased from $3.70$3.67 per DTH during the first nine months of fiscal 2025 to $4.84 per DTH in the first halfnine of fiscal 2025 to $5.07 per DTH in the first halfmonths of fiscal 2026. Although incurred by the Company during the sixsecond monthsquarter endedof March 31,fiscal 2026, the recovery of these costs will be collected from customers over the ensuing 12 to 18 months. The colder weather and increased gas costs also resulted in higher accounts receivable balances. WNA revenues for the first nine months of fiscal 2026 declined by approximately $605,000 from the same period last year, corresponding to a 3% increase in the number of heating degree days between periods. This decline in the WNA receivable contributed approximately $387,000 in operating cash.

Investing activities primarily consist of expenditures related to Roanoke Gas' utility property, which includes replacing aging natural gas pipe with new plastic or coated steel pipe, improvements to the LNG plantplant, separate from the repairs previously discussed, and gas distribution system facilities and expansion of its natural gas system to meet new customer demand. The Company is continuing its focus on SAVE infrastructure replacement projects, including the replacement of pre-1973 first generation plastic pipe. New customer demand for natural gas continues to be steady and therefore extending the natural gas distribution system within its service territory is also a priority. Roanoke Gas' total capital expenditures for the six-monthnine-month period ended MarchJune 31,30, 2026 were approximately $9.8$16.1 million compared to $10.7$15.7 million during the same period last year. The decline is a result of colder weather delaying completion of capital projects. Total fiscal 2026 capital expenditures are expected to be approximately $22 million.

Investing cash flows also include the Company's funding of its participation in Southgate and Boost, with a total cash investment of approximately $731,000$1 million for the sixnine months ended MarchJune 31,30, 2026, which are being funded by dedicated revolving credit facilities as described below. WithUpon receiving FERC approval and issuance of the Notice to ProceedProceed, construction activities began in Virginia on the Southgate extension,extension constructionin activitiesMarch have2026. begun.In June 2026, work began in North Carolina after the project received all necessary permits and authorizations for construction. While the Boost expansion is pending FERC approval, work has continued with federal and state regulators as they review project plans and permit applications, and investments have been made for materials related to the construction of the pipeline and other pre-constructions costs. With MVP in service, Midstream will incur periodic,periodic future capital investment related to ongoing MVP operations requirements and system improvements.

Cash Flows ProvidedUsed byin Financing Activities:

Financing activities generally consist of borrowings and repayments under credit agreements, issuance of common stock and the payment of dividends. Net cash flows used in financing activities were approximately $4.9$5.2 million for the sixnine months ended MarchJune 31,30, 2026, compared to approximately $9.9$11.3 million for the same period last year. The $5$6.1 million reduction in financing cash flows is primarily attributable to a decrease in net repayments under Roanoke Gas' line-of-credit, slightly offset by an increase in net payments under Midstream's notes payable. The Company's net paymentsborrowings on Roanoke Gas' line-of-credit during the first sixnine months of fiscal 2026 were $1.2approximately million$895,000 compared to $7.0net payments of $6.2 million in the same period last year. Additionally, during the first halfnine months of fiscal 2026, Midstream repaid a net $692,000$1.1 million compared to borrowing a net $145,000$255,000 during the same period in the prior year. Notes 6 and 7 provide details on the Company's line-of-credit and borrowing activity.

Resources issued a total of 67,50379,947 shares of common stock resulting in net proceeds of approximately $1.4$1.7 million during the first sixnine months of fiscal 2026, compared to issuing 59,98674,057 shares of common stock resulting in net proceeds of approximately $1.2$1.5 million during the first sixnine months of fiscal 2025. The ATM program was not utilized during either period.

Management regularly evaluates the Company’s liquidity through a review of its available financing resources and its cash flows. On June 2, 2026, Roanoke Gas hasentered ainto terman unsecured delayed-draw promissory note in the principal amount of $15 millionmillion. comingUnder duethe inprovisions of the loan agreement, Roanoke Gas can draw the funds at any time through September 20, 2026. The Company intends to draw the full amount on August 2026.20, 2026 and the proceeds will be used to repay a maturing note of equal amount. Management believes Roanoke Gas has access to sufficient financing resources to meet its cash requirements for the next year, including cash from operations, the line of credit and a private shelf facility. Roanoke Gas may also adjust capital spending as necessary, if such a need would arise.

Midstream's future cash requirements will relate to regular monthly operating expenses, debt service and capital contributions. Since MVP became operational, the Company has received quarterly Excess Cash Distributions, as defined in the agreements, that have averaged from $800,000 to $900,000. The Company receivedexpects two quarterly cashfuture distributions fromto MVPbe inof fiscal 2026 totaling approximately $1.4 million, and should receivea similar quarterly distributions going forward.magnitude. On September 5, 2025, Midstream established new amortizing term notes with two banks in the initial amounts of $38.6 million and $15 million, which refinanced and replaced all of Midstream's outstanding debt. The term notes mature on September 5, 2032. Also on September 5, 2025, Midstream entered into a new Loanloan Agreementagreement for the MVP Southgate extension and MVP Boost expansion that can be drawn to principal amounts of $1.85 million and $3.65 million, respectively. These loans mature on September 5, 2030, at which time the outstanding principal balance on each note is due. With the establishment of the new term notes, Midstream's total debt principal payments over the succeeding 12 months is $2,846,018. Management believes that it will be able to meet Midstream's cash requirements over the ensuing 12-month period with availability on the Southgate and Boost revolving credit facilities and its quarterly cash distributions from MVP.

As of MarchJune 31,30, 2026, Resources' long-term capitalization ratio was 46%45% equity and 54%55% debt.