Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A)
Quantitative and Qualitative Disclosures about Market Risk
Financial Statements and Supplementary Data
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Controls and Procedures
Other Information
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
PART III
Directors, Executive Officers and Corporate Governance
Executive Compensation
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Certain Relationships and Related Transactions, and Director Independence
Principal Accountant Fees and Services
PART IV
Exhibits and Financial Statement Schedules
SIGNATURES
Signatures
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In this Annual Report on Form 10-K, the “Company”, “Unitil”, “we”, “us”, “our” and similar terms refer to Unitil Corporation and its subsidiaries, unless the context requires otherwise.
CAUTIONARY STATEMENT
This report and the documents incorporated by reference into this report contain statements that may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, included or incorporated by reference into this report, including, without limitation, statements regarding the financial position, business strategy and other plans and objectives for the future operations of the Company (as such term is defined in Part I, Item I (Business)), are forward-looking statements.
These statements include declarations regarding the Company’s beliefs and current expectations. In some cases, forward-looking statements can be identified by terminology such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of such terms or other comparable terminology. These forward-looking statements are subject to inherent risks and uncertainties in predicting future results and conditions that could cause the actual results to differ materially from those projected in these forward-looking statements. Some, but not all, of the risks and uncertainties include those described in Part I, Item 1A (Risk Factors) and the following:
numerous hazards and operating risks relating to the Company’s electric and natural gas distribution activities, which could result in accidents and other operating risks and costs;
fluctuations in the supply of, demand for, and the prices of, electric and gas energy commodities and transmission and transportation capacity and the Company’s ability to recover energy supply costs in its rates;
catastrophic events;
cyber-attacks, acts of terrorism, acts of war, severe weather, a solar event, an electromagnetic event, a natural disaster, the age and condition of information technology assets, human error, or other factors could disrupt the Company’s operations and cause the Company to incur unanticipated losses and expense;
outsourcing of services to third parties could expose us to substandard quality of service delivery or substandard deliverables, which may result in missed deadlines or other timeliness issues, non-compliance (including with applicable legal requirements and industry standards) or reputational harm, which could negatively affect the Company’s results of operations;
unforeseen or changing circumstances, which could adversely affect the reduction of Company-wide direct greenhouse gas emissions;
the Company’s regulatory and legislative environment (including laws and regulations relating to climate change, greenhouse gas emissions and other environmental matters) could affect the rates the Company is able to charge, the Company’s authorized rate of return, the Company’s ability to recover costs in its rates, the Company’s financial condition, results of operations and cash flows, and the scope of the Company’s regulated activities;
general economic conditions, which could adversely affect (i) the Company’s customers and, consequently, the demand for the Company’s distribution services, (ii) the availability of credit and liquidity resources, and (iii) certain of the Company’s counterparty’s obligations (including those of its insurers and lenders);
the Company’s ability to obtain debt or equity financing on acceptable terms;
increases in interest rates, which could increase the Company’s interest expense;
the Company’s payment of dividends in the future;
declines in capital markets valuations, which could require the Company to make substantial cash contributions to cover its pension obligations, and the Company’s ability to recover pension obligation costs in its rates;
the Company’s ability to consummate acquisitions or other strategic transactions, to successfully integrate any acquired assets or business, or derive value from strategic transactions and investment, including but not limited to the completed acquisitions of Bangor Natural Gas Company and Maine Natural Gas Corporation;
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impairment of the Company’s assets (including long-lived assets and goodwill), could negatively impact the Company’s financial condition and results of operations;
restrictive covenants contained in the terms of the Company’s and its subsidiaries’ indebtedness, which restrict certain aspects of the Company’s business operations:
customers’ preferred energy sources;
severe storms and the Company’s ability to recover storm costs in its rates;
variations in weather, which could decrease demand for the Company’s distribution services;
long-term global climate change, which could adversely affect customer demand or cause extreme weather events that could disrupt the Company’s electric and natural gas distribution services;
macroeconomic events, including the imposition of tariffs;
employee workforce factors, including the ability to attract and retain key personnel;
the Company’s ability to retain its existing customers and attract new customers;
increased competition; and
other presently unknown or unforeseen factors.
Many of these risks are beyond the Company’s control. Any forward-looking statements speak only as of the date of this report, and the Company undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date on which such statements are made or to reflect the occurrence of unanticipated events, except as required by law. New factors emerge from time to time, and it is not possible for the Company to predict all such factors, nor can the Company assess the effect of any such factor on its business or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statements.
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PART I
Item 1. Business
UNITIL CORPORATION
In this Annual Report on Form 10-K, the “Company”, “Unitil”, “we”, and “our” refer to Unitil Corporation and its subsidiaries, unless the context requires otherwise. Unitil is a public utility holding company incorporated under the laws of the State of New Hampshire in 1984. The following companies are wholly-owned subsidiaries of Unitil:
Company Name
State and Year of
Organization
Principal Business
Unitil Energy Systems, Inc. (Unitil Energy)
Electric Distribution Utility
Fitchburg Gas and Electric Light Company (Fitchburg)
Electric & Natural Gas Distribution Utility
Northern Utilities, Inc. (Northern Utilities)
Natural Gas Distribution Utility
Bangor Natural Gas Company (Bangor)
Natural Gas Distribution Utility
Maine Natural Gas Corporation (Maine Natural)
Natural Gas Distribution Utility
Granite State Gas Transmission, Inc. (Granite State)
Natural Gas Transmission Pipeline
Unitil Power Corp. (Unitil Power)
Wholesale Electric Power Utility
Unitil Service Corp. (Unitil Service)
Utility Service Company
Unitil Realty Corp. (Unitil Realty)
Real Estate Management
Unitil Resources, Inc. (Unitil Resources)
Non-regulated Energy Services
Unitil Water Corp. (Unitil Water)
Non-regulated Company
Unitil and its subsidiaries are subject to regulation as a holding company system by the Federal Energy Regulatory Commission (FERC) under the Energy Policy Act of 2005.
Unitil’s principal business is the local distribution of electricity and natural gas to approximately 215,100 customers throughout its service territories in the states of New Hampshire, Massachusetts and Maine. Unitil is the parent company of five wholly-owned distribution utilities: i) Unitil Energy, which provides electric service in the southeastern seacoast and state capital regions of New Hampshire, including the capital city of Concord, ii) Fitchburg, which provides both electric and natural gas service in the greater Fitchburg area of north central Massachusetts, iii) Northern Utilities, which provides natural gas service in southeastern New Hampshire and portions of southern and central Maine, including the city of Portland, which is the largest city in northern New England, iv) Bangor, which provides natural gas service in the Bangor area of central Maine, and v) Maine Natural, which provides natural gas service in southern and central Maine, including the greater Portland region, as well as the capital city of Augusta. In addition, Unitil is the parent company of Granite State, an interstate natural gas transmission pipeline company that provides interstate natural gas pipeline access and transportation services to Northern Utilities in its New Hampshire and Maine service territory. Together, Unitil’s five distribution utilities serve approximately 110,100 electric customers and 105,000 natural gas customers.
Customers Served as of December 31, 2025
Residential
Commercial &
Industrial (C&I)
Total
Electric:
Unitil Energy
Fitchburg
Total Electric
Natural Gas:
Northern Utilities
Fitchburg
Bangor
Maine Natural
Total Natural Gas
Total Customers Served
Unitil had an investment in Net Utility Plant of $1.8 billion at December 31, 2025. The Company’s total operating revenue was $536.0 million in 2025. Unitil’s operating revenue is substantially derived from regulated electric and natural gas distribution utility operations. A seventh utility subsidiary, Unitil Power, formerly functioned as the full requirements wholesale
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power supply provider for Unitil Energy, but ceased being the wholesale supplier of Unitil Energy with the implementation of industry restructuring and divested its long-term power supply contracts.
Unitil has four other wholly-owned non-utility subsidiaries: Unitil Service, Unitil Realty, Unitil Resources and Unitil Water. Unitil Service provides, at cost, a variety of administrative and professional services, including regulatory, financial, accounting, human resources, engineering, operations, technology and energy supply management services on a centralized basis to its affiliated Unitil companies. Unitil Realty owns and manages the Company’s corporate office in Hampton, New Hampshire and land in Kingston, New Hampshire on which Unitil Energy’s solar facility is located, which became operational in May 2025. Unitil Resources is the Company’s wholly-owned non-regulated subsidiary which currently does not have any activity. Unitil Water currently does not have any activity. For segment information relating to each segment’s revenue, earnings and assets, see Note 2 (Segment Information) to the Consolidated Financial Statements included in Part II, Item 8 (Financial Statements and Supplementary Data) of this report. All of the Company’s revenues are attributable to customers in the United States of America and all its long-lived assets are located in the United States of America.
OPERATIONS
Electric Distribution Utility Operations
Unitil’s electric distribution operations are conducted through two of the Company’s utilities, Unitil Energy and Fitchburg. Revenue from Unitil’s electric utility operations was $236.4 million in 2025, which represents about 44% of Unitil’s total operating revenue. The Company’s GAAP (as defined below) Electric Gross Margin was $82.7 million in 2025. The Company’s Electric Adjusted Gross Margin (a non-GAAP financial measure) was $114.6 million in 2025, or 37% of Unitil’s total Adjusted Gross Margin. See “Results of Operations” in Part II, Item 7 (Management’s Discussion and Analysis of Financial Condition and Results of Operations) for a discussion of the non-GAAP financial measures presented in this Annual Report on Form 10-K, including a reconciliation of the non-GAAP financial measures to the most comparable GAAP financial measures for the periods presented.
The primary business of Unitil’s electric utility operations is the local distribution of electricity to customers in its service territory in New Hampshire and Massachusetts. All of Unitil Energy’s and Fitchburg’s electric customers are entitled to purchase their supply of electricity from third-party competitive suppliers, while Unitil Energy and Fitchburg remain their electric distribution company. Both Unitil Energy and Fitchburg supply electricity to those customers who do not obtain their supply from third-party competitive suppliers, with the approved costs associated with electricity supply being recovered on a pass-through basis under regulated reconciling rate mechanisms that are periodically adjusted.
Unitil Energy distributes electricity to approximately 79,400 customers in New Hampshire in the capital city of Concord as well as parts of thirteen surrounding towns, and all or part of nineteen towns in the southeastern and seacoast regions of New Hampshire, including the towns of Hampton, Exeter, Atkinson and Plaistow. Unitil Energy’s service territory consists of approximately 408 square miles. Unitil Energy’s service territory encompasses retail and recreation centers for the central and southeastern parts of the state and includes the Hampton Beach recreational area. These areas serve diversified commercial and industrial businesses, including manufacturing firms engaged in the production of electronic components, wire and plastics, as well as firms engaged in the aviation, defense, healthcare and education sectors. Unitil Energy’s 2025 electric operating revenue was $157.3 million, of which approximately 55% was derived from residential sales and 45% from commercial and industrial (C&I) sales.
Fitchburg is engaged in the distribution of both electricity and natural gas in the greater Fitchburg area of north central Massachusetts. Fitchburg’s service territory encompasses approximately 170 square miles. Electricity is distributed by Fitchburg to approximately 30,700 customers in the communities of Fitchburg, Ashby, Townsend and Lunenburg. Fitchburg’s industrial customers include paper manufacturing and paper products companies, rubber and plastics manufacturers, precision machining and molding, non-lethal ballistics manufacturing, specialty chemicals compounding, cannabis growing and processing facilities, printing, and educational institutions. Fitchburg’s 2025 electric operating revenue was $79.1 million, of which approximately 59% was derived from residential sales and 41% from C&I sales.
Natural Gas Operations
Unitil’s natural gas operations include gas distribution utility operations and interstate gas transmission pipeline operations. Revenue from Unitil’s gas operations was $299.6 million in 2025, which represents about 56% of Unitil’s total operating revenue. The Company’s GAAP Gas Gross Margin was $142.3 million in 2025. The Company’s Gas Adjusted Gross
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Margin (a non-GAAP financial measure) was $199.1 million in 2025, or 63% of Unitil’s total Adjusted Gross Margin. See “Results of Operations” in Part II, Item 7 (Management’s Discussion and Analysis of Financial Condition and Results of Operations) for a discussion of the non-GAAP financial measures presented in this Annual Report on Form 10-K, including a reconciliation of the non-GAAP financial measures to the most comparable GAAP financial measures for the periods presented.
Natural Gas Distribution Utility Operations
Unitil’s natural gas distribution operations are conducted through four of the Company’s operating utilities, Northern Utilities, Fitchburg, Bangor and Maine Natural. The primary business of Unitil’s natural gas utility operations is the local distribution of natural gas to customers in its service territories in New Hampshire, Massachusetts and Maine. Northern Utilities’, Bangor’s and Maine Natural’s C&I customers and Fitchburg’s residential and C&I customers are able to purchase their natural gas supply from third-party competitive suppliers, while Northern Utilities, Bangor, Maine Natural or Fitchburg remains their gas distribution company. Northern Utilities, Fitchburg, Bangor and Maine Natural supply gas to those customers who do not obtain their supply from third-party competitive suppliers, with the approved costs associated with this gas supply recovered on a pass-through basis under regulated reconciling rate mechanisms that are periodically adjusted.
Northern Utilities distributes natural gas to approximately 73,200 customers in fifty New Hampshire and southern Maine communities, from Plaistow, New Hampshire in the south to the city of Portland, Maine and then extending to Lewiston-Auburn, Maine to the north. Northern Utilities has a diversified customer base both in Maine and New Hampshire. Commercial businesses include healthcare, education, government and retail. Northern Utilities’ industrial base includes manufacturers in the auto, housing, paper, printing, textile, pharmaceutical, electronics, wire and food production industries as well as a military installation. Northern Utilities’ 2025 gas operating revenue was $191.3 million, of which approximately 37% was derived from residential firm sales and 63% from C&I firm sales.
Fitchburg distributes natural gas to approximately 16,400 customers in the communities of Fitchburg, Lunenburg, Townsend, Ashby, Gardner and Westminster, all located in Massachusetts. Fitchburg’s industrial customers include paper manufacturing and paper products companies, rubber and plastics manufacturers, cannabis growing and processing facilities, printing, and educational institutions. Fitchburg’s 2025 gas operating revenue was $59.5 million, of which approximately 59% was derived from residential firm sales and 41% from C&I firm sales.
Bangor distributes natural gas to approximately 8,900 customers in ten communities in the Bangor area of central Maine. Bangor’s commercial customers include healthcare, education, retail and hospitality. Bangor’s industrial customers include manufacturers in outdoor products, electronics, and food production industries. Bangor’s 2025 gas operating revenue from the date of acquisition was $27.9 million, of which approximately 39% was derived from residential firm sales and 61% from C&I firm sales.
Maine Natural distributes natural gas to approximately 6,500 customers in nine communities in the greater Portland region of Maine, as well as the capital city of Augusta. Maine Natural’s commercial customers include healthcare, education, government and retail. Maine Natural’s industrial customers include shipbuilding, construction, aggregate and materials production, and paving. Maine Natural’s 2025 gas operating revenue from the date of acquisition was $8.3 million, of which approximately 28% was derived from residential firm sales and 72% from C&I firm sales.
Gas Transmission Pipeline Operations
Granite State is an interstate natural gas transmission pipeline company, operating 85 miles of underground gas transmission pipeline primarily located in Maine and New Hampshire. Granite State provides Northern Utilities with interconnection to major natural gas pipelines and access to domestic natural gas supplies in the south and Canadian natural gas supplies in the north. Granite State had operating revenue of $12.6 million in 2025. Granite State derives its revenues principally from the transportation services provided to Northern Utilities and to third-party suppliers under FERC-approved rates.
Seasonality
The Company’s results of operations are expected to reflect the seasonal nature of the natural gas business. Annual gas revenues are substantially realized during the colder weather seasons of the year as a result of higher sales of natural gas used for heating-related purposes. Accordingly, the results of operations are historically most favorable in the first and fourth
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quarters. Fluctuations in seasonal weather conditions may have a significant effect on the result of operations. Sales of electricity are generally less sensitive to weather than natural gas sales, but may also be affected by weather conditions and the temperature in the winter and summer seasons.
Unitil Energy, Fitchburg, Northern Utilities, Bangor and Maine Natural have a well-diversified customer mix and are not dependent on a single customer, or a few customers, for their electric and natural gas sales.
Revenue Decoupling
The Company’s electric and gas sales in Massachusetts and New Hampshire are largely decoupled. Revenue decoupling eliminates the dependency of distribution revenue on the volume of electricity or gas sold. The difference between distribution revenue amounts billed to customers and the targeted revenue decoupling amounts is recognized as an increase or a decrease in Accrued Revenue, which forms the basis for resetting rates for future cash recoveries from, or credits to, customers. These revenue decoupling targets may be adjusted as a result of rate cases and other authorized adjustments that the Company files with the MDPU and NHPUC.
Non-Regulated and Other Non-Utility Operations
The results of Unitil’s other non-utility subsidiaries, Unitil Service, Unitil Resources, Unitil Realty, Unitil Water and the holding company, are included in the Company’s consolidated results of operations. The results of these non-utility operations are principally derived from income earned on short-term investments and real property owned for Unitil’s and its subsidiaries’ use and are reported, after intercompany eliminations, in Other segment income. For segment information, see Note 2 (Segment Information) to the Consolidated Financial Statements included in Part II, Item 8 (Financial Statements and Supplementary Data) of this report.
RATES AND REGULATION
Regulation
Unitil is subject to comprehensive regulation by federal and state regulatory authorities. Unitil and its subsidiaries are subject to regulation as a holding company system by the FERC under the Energy Policy Act of 2005 with regard to certain bookkeeping, accounting and reporting requirements. Unitil’s utility operations related to wholesale and interstate energy business activities also are regulated by the FERC. Unitil’s distribution utilities are subject to regulation by the applicable state public utility commissions, with regard to their rates, issuance of securities and other accounting and operational matters: Unitil Energy is subject to regulation by the NHPUC; Fitchburg is subject to regulation by the MDPU; Northern Utilities is regulated by the NHPUC and Maine Public Utilities Commission (MPUC); and Bangor and Maine Natural are regulated by the MPUC. Granite State, Unitil’s interstate natural gas transmission pipeline, is subject to regulation by the FERC with regard to its rates and operations. Because Unitil’s primary operations are subject to rate regulation, the regulatory treatment of various matters could significantly affect the Company’s operations and financial position.
Unitil Energy, Fitchburg, Northern Utilities and Maine Natural’s non-Augusta service areas deliver electricity and/or natural gas to all customers in their service territory, at rates established under cost of service regulation. Under this regulatory structure, Unitil’s distribution utilities are provided the opportunity to recover the cost of providing distribution service to their customers based on a test year, and to earn a reasonable return on their capital investment in utility assets. In addition, the Company’s distribution utilities and its natural gas transmission pipeline company may recover certain base rate costs, including capital project spending and enhanced reliability and vegetation management programs, through annual step adjustments and cost tracking rate mechanisms. Bangor and Maine Natural’s Augusta Service Area deliver natural gas to their customers at rates established under alternative rate plans, which provide multi-year rate changes designed to approximate market-based rates. The Company's electric and gas sales in New Hampshire and Massachusetts are largely decoupled.
Also see Note 1 (Summary of Significant Accounting Policies), Note 6 (Energy Supply) and Note 8 (Commitments and Contingencies) to the accompanying Consolidated Financial Statements for additional information regarding rates and regulation.
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EMPLOYEES
As of December 31, 2025, the Company and its subsidiaries had 595 employees. The Company considers its relationship with employees to be good and has not experienced any major labor disruptions.
The Company strives to be the employer of choice in the communities it serves. The Company works diligently to attract the best talent from a diverse range of sources to meet the current and future demands of the Company’s business.
To attract and retain a talented workforce, Unitil provides employee wages that are competitive and consistent with employee positions, skill levels, experience, knowledge and geographic location. All employees are eligible for health insurance, paid and unpaid leave, educational assistance, retirement plan and life and disability/accident coverage. Feedback from employees is collected annually in the Company’s employee opinion survey. This feedback helps create action plans to improve the engagement of employees consistent with the Company’s culture of continuous improvement.
As of December 31, 2025, a total of 192 employees of certain of the Company’s subsidiaries were represented by labor unions. The following table details by subsidiary the employees covered by a collective bargaining agreement (CBA) as of December 31, 2025:
Employees Covered
CBA Expiration
Unitil Energy
Fitchburg
Northern Utilities NH Division
Northern Utilities ME Division
Bangor
Maine Natural
Granite State
Unitil Service
The CBAs provide discrete salary adjustments, established work practices and uniform benefit packages. The Company expects to negotiate new agreements prior to their expiration dates.
RECENT DEVELOPMENTS
Acquisition of Bangor Natural Gas Company
On January 31, 2025, the Company acquired all issued and outstanding shares of Bangor for $71.4 million, which includes an estimated working capital adjustment. Through this acquisition, the Company expanded its service territory to include approximately 8,500 customers in the greater Bangor area of central Maine.
Acquisition of Maine Natural Gas Corporation
On March 31, 2025, the Company entered into a Stock Purchase Agreement (the Avangrid Purchase Agreement) between the Company and Avangrid Enterprises, Inc. (Avangrid). Pursuant to, and subject to the terms and conditions of, the Avangrid Purchase Agreement, the Company agreed to acquire all of the issued and outstanding shares of capital stock of Maine Natural from Avangrid for $86.0 million in cash, subject to certain adjustments as provided in the Avangrid Purchase Agreement. The MPUC issued an order on September 12, 2025 approving the merger of Maine Natural into the Company. The transaction closed on October 31, 2025.
AVAILABLE INFORMATION
The Internet address for the Company’s website is unitil.com . On the Investors section of the Company’s website, the Company makes available, free of charge, its Securities and Exchange Commission (SEC) reports, including annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and other reports, as well as amendments to those
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reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practical after the Company electronically files such material with, or furnishes such material to, the SEC.
The Company’s current Code of Ethics was approved by Unitil’s Board of Directors (the “Board”) on January 15, 2004. This Code of Ethics, along with any amendments or waivers, is also available on Unitil’s website.
Unitil’s common stock is listed on the New York Stock Exchange under the ticker symbol “UTL”.
INVESTOR INFORMATION
Annual Meeting
The Company’s annual meeting of shareholders is scheduled to be held at the offices of the Company, 6 Liberty Lane West, Hampton, New Hampshire, on Wednesday, April 29, 2026, at 11:30 a.m. Eastern Time.
Transfer Agent
The Company’s transfer agent, Computershare Investor Services, is responsible for shareholder records, issuance of common stock, administration of the Dividend Reinvestment and Stock Purchase Plan, and the distribution of Unitil’s dividends and IRS Form 1099-DIV. Shareholders may contact Computershare at:
Computershare Investor Services
P.O. Box 43078
Providence, RI 02940-3078
Telephone: 800-736-3001
computershare.com/investor
Investor Relations
For information about the Company, you may call the Company directly, toll-free, at: 800-999-6501 and ask for the Investor Relations Representative; visit the Investors page at unitil.com ; or contact the transfer agent, Computershare, at the number listed above.
Special Services & Shareholder Programs Available to Holders of Record
If a shareholder’s shares of the Company’s common stock are registered directly in the shareholder’s name with the Company’s transfer agent, the shareholder is considered a holder of record of the shares. The following services and programs are available to shareholders of record:
Online Account Access is available at computershare.com/investor .
Dividend Reinvestment and Stock Purchase Plan:
To enroll, please contact the Company’s Investor Relations Representative or Computershare.
Dividend Direct Deposit Service:
To enroll, please contact the Company’s Investor Relations Representative or Computershare.
Direct Registration:
For information, please contact Computershare at 800-935-9330 or the Company’s Investor Relations Representative at 800-999-6501.
Item 1A. Risk Factors
When considering an investment in the Company’s securities, investors should consider the following risk factors, as well as the information contained under the caption “Cautionary Statement” immediately following the Table of Contents in this Annual Report on Form 10-K. Additional risks not presently known to the Company or that the Company currently believes are immaterial may also impair business operations and financial results. If any of the following risks actually occur, the
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Company’s business, financial condition or results of operations could be adversely affected. In such case, the trading price of the Company’s common stock could decline and investors could lose all or part of their investment. The risk factors below are categorized by operational, regulatory, financial and general.
OPERATIONAL RISKS
A substantial disruption or lack of growth in interstate natural gas pipeline transmission and storage capacity and electric transmission capacity may impair the Company’s ability to meet customers’ existing and future requirements.
To meet existing and future customer demands for electricity and natural gas, the Company must acquire sufficient supplies of electricity and natural gas. In addition, the Company must contract for reliable and adequate upstream transmission and transportation capacity for its distribution systems while considering the dynamics of the natural gas interstate pipelines and storage, the electric transmission markets and its own on-system resources. The Company’s financial condition or results of operations may be adversely affected if the future availability of electric and natural gas supply were insufficient to meet future customer demands for electricity and natural gas.
The Company’s electric and natural gas distribution activities (including storing natural gas and supplemental gas supplies) involve numerous hazards and operating risks that may result in accidents and other operating risks and costs. Any such accident or costs could adversely affect the Company’s financial position or results of operations.
Inherent in the Company’s electric and natural gas distribution activities are a variety of hazards and operating risks, including leaks, explosions, electrocutions, mechanical problems and aging infrastructure. These hazards and risks could result in loss of human life, significant damage to property, environmental pollution, damage to natural resources and impairment of the Company’s operations, which could adversely affect the Company’s financial position or results of operations.
The Company maintains insurance against some, but not all, of these risks and losses in accordance with customary industry practice. The location of pipelines, storage facilities and electric distribution equipment near populated areas (including residential areas, commercial business centers and industrial sites) could increase the level of damages associated with these hazards and operating risks. The occurrence of any of these events could adversely affect the Company’s financial position or results of operations.
The Company’s operational and information systems on which it relies to conduct its business and serve customers could fail to function properly due to technological problems, a cyber-attack, acts of terrorism, severe weather, a solar event, an electromagnetic event, a natural disaster, the age and condition of information technology assets, human error, or other reasons, that could disrupt the Company’s operations and cause the Company to incur unanticipated losses and expense.
The operation of the Company’s extensive electric and natural gas systems rely on evolving information and operating technology systems and network infrastructure that are likely to become more complex as new technologies and systems are developed. The Company’s business is highly dependent on its ability to process and monitor, on a daily basis, a very large number of transactions, many of which are highly complex. The failure of these systems and networks could significantly disrupt operations; result in outages and/or damages to the Company’s assets or operations or those of third parties on which it relies; and subject the Company to claims by customers or third parties, any of which could have a material effect on the Company’s financial condition, results of operations, and cash flows.
The Company’s information systems, including its financial information, operational systems, metering, and billing systems, require constant maintenance, modification, and updating, which can be costly and increases the risk of errors and malfunction. Any disruptions or deficiencies in existing information systems, or disruptions, delays or deficiencies in the modification or implementation of new information systems, could result in increased costs, the inability to track or collect revenues, the diversion of management’s and employees’ attention and resources, and could negatively affect the effectiveness of the Company’s control environment, and/or the Company’s ability to timely file required regulatory reports. Despite implementation of security and mitigation measures, all of the Company’s technology systems are vulnerable to impairment or failure due to cyber-attacks, computer viruses, human errors, acts of war or terrorism and other reasons. If the Company’s information technology systems were to fail or be materially impaired, the Company might be unable to fulfill critical business functions and serve its customers, which could have a material effect on the Company’s financial condition, results of operations, and cash flows.
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In the ordinary course of its business, the Company collects and retains sensitive electronic data including personal identification information about customers and employees, customer energy usage, and other confidential information. The theft, damage, or improper disclosure of sensitive electronic data through security breaches or other means could subject the Company to penalties for violation of applicable privacy laws or claims from third parties and could harm the Company’s reputation and adversely affect the Company’s financial condition and results of operations.
In addition, the Company’s electric and natural gas distribution and transmission delivery systems are part of an interconnected regional grid and pipeline system. If these neighboring interconnected systems were to be disrupted due to cyber-attacks, computer viruses, human errors, acts of war or terrorism or other reasons, the Company’s operations and its ability to serve its customers would be adversely affected, which could have a material effect on the Company’s financial condition, results of operations, and cash flows.
We outsource certain business functions to third-party suppliers and service providers, and substandard performance by those third parties could harm the Company’s business, reputation and results of operations.
We outsource certain services to third parties in areas including information technology, telecommunications, networks, transaction processing, human resources, payroll and payroll processing and other areas. Outsourcing of services to third parties could expose us to substandard quality of service delivery or substandard deliverables, which may result in missed deadlines or other timeliness issues, non-compliance (including with applicable legal requirements and industry standards) or reputational harm, which could negatively affect the Company’s results of operations. We also continue to pursue enhancements to modernize the Company’s systems and processes. If any difficulties in the operation of these systems were to occur, they could adversely affect the Company’s results of operations, or adversely affect the Company’s ability to work with regulators, unions, customers or employees.
The inability to attract and retain a qualified workforce including, but not limited to, executive officers, key employees and employees with specialized skills, could have an adverse effect on the Company’s operations.
The success of the Company’s business depends on the leadership of the Company’s executive officers and other key employees to implement the Company’s business strategies. The inability to maintain a qualified workforce including, but not limited to, executive officers, key employees and employees with specialized skills, may negatively affect the Company’s ability to service the Company’s existing or new customers, or successfully manage the Company’s business or achieve the Company’s business objectives. There may not be sufficiently skilled employees available internally to replace employees when they retire or otherwise leave active employment. Shortages of certain highly skilled employees may also mean that qualified employees are not available externally to replace these employees when they are needed. In addition, shortages in highly skilled employees coupled with competitive pressures may require the Company to incur additional employee recruiting and compensation expenses.
The Company may be adversely affected by work stoppages, labor disputes, and/or pandemic illness to which it may not be able to promptly respond.
Approximately one-third of the Company’s employees are represented by labor unions and are covered by collective bargaining agreements. Disputes with the unions over terms and conditions of the agreements could result in instability in the Company’s labor relationships and work stoppages that could affect the timely delivery of electricity and natural gas, which could strain relationships with customers and state regulators and cause a loss of revenues. The Company’s collective bargaining agreements also may increase the cost of employing its union workforce, affect its ability to continue offering market-based salaries and employee benefits, limit its flexibility in dealing with its workforce, and limit its ability to change work rules and practices and implement other efficiency-related improvements to successfully compete in today’s challenging marketplace, which may negatively affect the Company’s financial condition and results of operations.
Additionally, pandemic illness could result in part, or all, of the Company’s workforce being unable to operate or maintain the Company’s infrastructure or perform other tasks necessary to conduct the Company’s business. A slow or inadequate response to this type of event may adversely affect the Company’s financial condition, results of operations, and cash flows.
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REGULATORY RISKS
The Company is subject to comprehensive regulation, which could adversely affect the rates it is able to charge, its authorized rate of return and its ability to recover costs. In addition, certain regulatory authorities have the statutory authority to impose financial penalties and other sanctions on the Company, which could adversely affect the Company’s financial condition, results of operations, and cash flows.
The Company is subject to comprehensive regulation by federal regulatory authorities (including the FERC) and state regulatory authorities (including the NHPUC, MDPU and MPUC). These authorities regulate many aspects of the Company’s operations, including the rates that the Company can charge customers, the Company’s authorized rates of return, the Company’s ability to recover costs from its customers, construction and maintenance of the Company’s facilities, the Company’s safety protocols and procedures, including environmental compliance, the Company’s ability to issue securities, the Company’s accounting matters, and transactions between the Company and its affiliates. The Company is unable to predict the effect on its financial condition and results of operations from the regulatory activities of any of these regulatory authorities. Changes in regulations, the imposition of additional regulations, regulatory proceedings regarding fossil fuel use and system electrification, or regulatory decisions particular to the Company could adversely affect the Company’s financial condition and results of operations.
The Company’s ability to obtain rate adjustments to maintain its current authorized rates of return depends upon action by regulatory authorities under applicable statutes, rules and regulations. These regulatory authorities are authorized to leave the Company’s rates unchanged, to grant increases in such rates, or to order decreases in such rates. The Company may be unable to obtain favorable rate adjustments or to maintain its current authorized rates of return, which could adversely affect its financial condition, results of operations, and cash flows.
Regulatory authorities also have authority with respect to the Company’s ability to recover its electricity and natural gas supply costs, as incurred by Unitil Energy, Fitchburg, Unitil Power, Northern Utilities, Bangor and Maine Natural. If the Company is unable to recover a significant amount of these costs, or if the Company’s recovery of these costs is significantly delayed, the Company’s financial condition, results of operations, or cash flows could be adversely affected.
In addition, certain regulatory authorities have the statutory authority to impose financial penalties and other sanctions on the Company if the Company is found to have violated statutes, rules or regulations governing its utility operations. Any such penalties or sanctions could adversely affect the Company’s financial condition, results of operations, and cash flows.
The Company’s business is subject to environmental regulation in all jurisdictions in which it operates and its costs of compliance are significant. New, or changes to existing, environmental regulation, including those related to climate change or greenhouse gas emissions, and the incurrence of environmental liabilities could adversely affect the Company’s financial condition, results of operations, and cash flows.
The Company’s utility operations are generally subject to extensive federal, state and local environmental laws and regulations relating to air quality, water quality, waste management, natural resources, and the health and safety of the Company’s employees. The Company’s utility operations also may be subject to new and emerging federal, state and local legislative and regulatory initiatives related to climate change or greenhouse gas emissions including the U.S. Environmental Protection Agency’s mandatory greenhouse gas reporting rule. Failure to comply with these laws and regulations may result in the assessment of administrative, civil, and criminal penalties and other sanctions; imposition of remedial requirements; and issuance of injunctions to ensure future compliance. Liability under certain environmental laws and regulations is strict, joint and several in nature. Although the Company believes it is in material compliance with all applicable environmental and safety laws and regulations, there is no assurance that the Company will not incur significant costs and liabilities in the future. Moreover, it is possible that other developments, such as increasingly stringent federal, state or local environmental laws and regulations, including those related to climate change or greenhouse gas emissions, could result in increased environmental compliance costs. The Company has committed to reduce greenhouse gas emissions from 2019 levels by at least 50% by 2030 and to achieve net-zero greenhouse gas emissions by 2050. Unforeseen or changing circumstances could adversely affect the Company's ability to achieve these greenhouse gas emissions goals and changes in the regulatory environment could result in the costs associated with efforts to achieve these goals not qualifying for recovery.
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FINANCIAL RISKS
The Company may not be able to obtain financing, or may not be able to obtain financing on acceptable terms, which could adversely affect the Company’s financial condition and results of operations.
The Company requires capital to fund utility plant additions, working capital and other utility expenditures. While the Company derives the capital necessary to meet these requirements primarily from internally generated funds, the Company supplements internally generated funds by incurring short-term and long-term debt, as needed. Additionally, from time to time the Company has accessed the public capital markets through public offerings of equity securities. A downgrade of the Company’s credit rating or events beyond the Company’s control, such as a disruption in global capital and credit markets, could increase the Company’s cost of borrowing and cost of capital or restrict the Company’s ability to access the capital markets and negatively affect the Company’s ability to maintain and to expand the Company’s businesses.
The Company’s short-term debt revolving credit facility typically has variable interest rates. Therefore, an increase or decrease in interest rates will increase or decrease the Company’s interest expense associated with its revolving credit facility. An increase in the Company’s interest expense could adversely affect the Company’s financial condition and results of operations. As of December 31, 2025, the Company had approximately $169.7 million in short-term debt outstanding under its revolving credit facility. If the lending counterparties under the Company’s current credit facility are unwilling or unable to meet their funding obligations, the Company may be unable to, or limited in its ability, to borrow under its credit facility. This situation could hinder or prevent the Company from meeting its current and future capital needs, which could correspondingly adversely affect the Company’s financial condition, results or operations, and cash flows.
Also, from time to time the Company repays portions of its short-term debt with the proceeds it receives from long-term debt financings or equity financings. General economic conditions, conditions in the capital and credit markets and the Company’s operating and financial performance could negatively affect the Company’s ability to obtain such financings or the terms of such financings, which could correspondingly adversely affect the Company’s financial condition, results of operations, and cash flows. The Company’s long-term debt typically has fixed interest rates. Therefore, changes in interest rates will not affect the Company’s interest expense associated with its presently outstanding fixed rate long-term debt. However, an increase or decrease in interest rates may increase or decrease the Company’s interest expense associated with any new fixed rate long-term debt issued by the Company, which could adversely affect the Company’s financial condition, results of operations, and cash flows.
The Company may need to use a significant portion of its cash flow to repay its short-term debt and long-term debt, which would limit the amount of cash it has available for working capital, capital expenditures and other general corporate purposes and could adversely affect its financial condition, results of operations, and cash flows.
Changes in taxation and the ability to quantify such changes could adversely affect the Company’s financial results.
The Company is subject to taxation by the various taxing authorities at the federal, state and local levels where it does business. Legislation or regulation which could affect the Company’s tax burden could be enacted by any of these governmental authorities. The Company cannot predict the timing or extent of such tax-related developments which could have a negative effect on the financial results. The Company uses its best judgment in attempting to quantify and reserve for these tax obligations. However, a challenge by a taxing authority, the Company’s ability to utilize tax benefits such as carryforwards or tax credits, or a deviation from other tax-related assumptions may cause actual financial results to deviate from previous estimates.
Declines in capital market valuations could require the Company to make substantial cash contributions to cover its pension and other post-retirement benefit obligations. If the Company is unable to recover a significant amount of pension and other post-retirement benefit obligation costs in its rates, or if the Company’s recovery of these costs in its rates is significantly delayed, its financial condition and results of operations could be adversely affected.
The amount of cash contributions the Company is required to make in respect of its pension and other post-retirement benefit obligations is dependent upon capital market valuations. Adverse changes in capital market valuations could result in the Company being required to make substantial cash contributions in respect to these obligations. These cash contributions could have an adverse effect on the Company’s financial condition, results of operations, and cash flows if the Company is unable to recover such costs in rates or if such recovery is significantly delayed. See section titled Critical Accounting Policies—Retirement Benefit Obligations in Part II, Item 7 (Management’s Discussion and Analysis of Financial Condition and Results of
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Operations) and Note 10 (Retirement Benefit Plans) to the accompanying Consolidated Financial Statements for a more detailed discussion of the Company’s pension obligations.
The terms of the Company’s and its subsidiaries’ indebtedness restrict the Company’s and its subsidiaries’ business operations (including their ability to incur material amounts of additional indebtedness), which could adversely affect the Company’s financial condition and results of operations.
The terms of the Company’s and its subsidiaries’ indebtedness impose various restrictions on the Company’s business operations, including the ability of the Company and its subsidiaries to incur additional indebtedness. These restrictions could adversely affect the Company’s financial condition, results of operations, and cash flows. The Company’s existing credit facility also provides for restrictions on, among other things, the Company’s and its subsidiaries’ ability to permit liens or incur indebtedness, and restrictions on the Company’s ability to merge or consolidate with another entity or change its line of business, and includes a financial covenant that the Company’s Funded Debt to Capitalization (as each term is defined in the Credit Facility) cannot exceed 65%, tested on a quarterly basis. See sections titled Liquidity, Commitments and Capital Requirements in Part II, Item 7 (Management’s Discussion and Analysis of Financial Condition and Results of Operations) and Note 4 (Debt and Financing Arrangements) to the accompanying Consolidated Financial Statements for a more detailed discussion of these restrictions.
Unitil is a public utility holding company and has no operating income of its own. The Company’s ability to pay dividends on its common stock is dependent on dividends and other payments received from its subsidiaries and on factors directly affecting Unitil, the parent corporation. The Company cannot assure that its current annual dividend will be paid in the future.
The ability of the Company’s subsidiaries to pay dividends or make distributions to Unitil depends on, among other things:
the actual and projected earnings and cash flow, capital requirements and general financial condition of the Company’s subsidiaries;
the prior rights of holders of existing and future preferred stock, mortgage bonds, long-term notes and other debt issued by the Company’s subsidiaries;
the restrictions on the payment of dividends contained in the existing loan agreements of the Company’s subsidiaries and that may be contained in future debt agreements of the Company’s subsidiaries, if any; and
limitations that may be imposed by New Hampshire, Massachusetts and Maine state regulatory authorities.
In addition, before the Company can pay dividends on its common stock, it must satisfy its debt obligations and comply with any statutory or contractual limitations.
As of February 9, 2026, the Company’s current effective annualized dividend is $1.90 per share of common stock, payable quarterly. The Board reviews Unitil’s dividend policy periodically in light of a number of business and financial factors, including those referred to in this report, and the Company cannot assure the amount of dividends, if any, that may be paid in the future.
Future sales and issuances of common stock or rights to purchase common stock, could result in dilution of the percentage ownership of the Company’s shareholders.
On June 3, 2025, the Company entered into a Distribution Agreement (the “Distribution Agreement”) with sales agents, as agents and/or forward sellers, and forward purchasers pursuant to which we may sell, from time to time, up to an aggregate sales price of $50 million of common stock, through the sales agents (the ATM program). During the year ended December 31, 2025, the Company sold 27,620 shares of common stock under the ATM program at an average price of $53.00 per share, resulting in gross proceeds of $1.5 million and net proceeds of $1.4 million after deducting commissions and offering expenses. As of December 31, 2025, $48.5 million remains available for future sales under the program. Any sales of shares of common stock through the sales agents may cause dilution to the Company’s existing shareholders.
The Company has made and may make acquisitions and may pursue other strategic transactions, which could impact the Company’s financial condition or results of operations.
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As part of the Company’s business strategy, the Company has made and may make acquisitions to add complementary companies, assets, services or products, and from time to time may enter into other strategic transactions such as investments and joint ventures. For example, the Company completed the acquisitions of Bangor Natural Gas Company on January 31, 2025 and Maine Natural Gas Corporation on October 31, 2025.
In the future, the Company may not be able to find suitable acquisition candidates, and may not be able to complete acquisitions or other strategic transactions on favorable terms, or at all. For example, on May 6, 2025, the Company entered into a definitive agreement to acquire Aquarion Water Company of Massachusetts, Inc., Aquarion Water Company of New Hampshire, Inc., and Abenaki Water Co., Inc. (the Aquarion Companies) from the Aquarion Water Authority, a quasi-public corporation and political subdivision of the State of Connecticut and a standalone, newly created water authority alongside the South Central Connecticut Regional Water Authority subject to certain closing adjustments. There is no guarantee that these acquisitions will be approved by the appropriate governmental and other regulatory authorities.
In some cases, the costs of such acquisitions or other strategic transactions may be substantial, and there is no assurance that the Company will realize expected synergies and potential monetization opportunities for the Company’s acquisitions, or a favorable return on investment for strategic investments.
The Company may pay substantial amounts of cash, issue equity, or incur debt to pay for acquisitions or strategic transactions. The Company may also discover liabilities, deficiencies, or other claims associated with the companies or assets acquired that were not identified in advance, which may result in significant unanticipated costs. In addition, the Company may fail to accurately forecast the financial impact of an acquisition or other strategic transaction, including tax and accounting charges. Any of these factors may adversely affect the Company’s financial condition or results of operations.
Potential tariffs could adversely affect the Company’s business and financial results.
The Company purchases natural gas from U.S. domestic and Canadian supply sources largely under contracts of one year or less. On occasion, the Company purchases natural gas from producers and marketers on the spot market. The U.S. presidential administration has implemented of a number of tariffs, including tariffs on energy imports from Canada, which could significantly increase the cost of natural gas in the U.S., potentially decreasing customer demand for natural gas. The Company may also need to obtain natural gas from other sources, when possible. Any of these factors may adversely affect the Company’s financial condition or results of operations.
GENERAL RISKS
The Company’s electric and natural gas sales and revenues are highly correlated with the economy, and national, regional and local economic conditions may adversely affect the Company’s customers and correspondingly the Company’s financial condition, results of operations, and cash flows.
The Company’s business is influenced by the economic activity within its service territory. The level of economic activity in the Company’s electric and natural gas distribution service territories directly affects the Company’s business. As a result, adverse changes in the economy may adversely affect the Company’s financial condition, results or operations, and cash flows. Economic downturns or periods of high electric and gas supply costs typically can lead to the development of legislative and regulatory policy designed to promote reductions in energy consumption and increased energy efficiency and self-generation by customers. This focus on conservation, energy efficiency and self-generation may result in a decline in electricity and gas sales in the Company’s service territories. If any such declines were to occur without corresponding adjustments in rates, the Company’s revenues would be reduced and the Company’s future growth prospects would be limited. In addition, a period of prolonged economic weakness could affect the Company’s customers’ ability to pay bills in a timely manner and increase customer bankruptcies, which may lead to increased bad debt expenses or other adverse effects on the Company’s financial position, results of operations, and cash flows.
A significant amount of the Company’s sales are temperature sensitive. Because of this, mild winter and summer temperatures could decrease the Company’s sales, which could adversely affect the Company’s financial condition and results of operations. Also, the Company’s sales may vary from year to year depending on weather conditions, and the Company’s results of operations generally reflect seasonality.
A significant amount of the Company’s natural gas sales are temperature sensitive. Therefore, mild winter temperatures could decrease the amount of natural gas sold by the Company, which could adversely affect the Company’s financial
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condition, results of operations, and cash flows. The Company’s electric sales also are temperature sensitive, but less so than its natural gas sales. The highest usage of electricity typically occurs in the summer months (due to air conditioning demand) and the winter months (due to heating-related and lighting requirements). Therefore, mild summer temperatures and mild winter temperatures could decrease the amount of electricity sold by the Company, which could adversely affect the Company’s financial condition, results of operations, and cash flows. Also, because of this temperature sensitivity, sales by the Company’s distribution utilities vary from year to year, depending on weather conditions.
The Company’s results of operations are expected to reflect the seasonal nature of the natural gas business. Annual gas revenues are substantially realized during the colder weather seasons of the year as a result of higher sales of natural gas used for heating-related purposes. Accordingly, the results of operations are historically most favorable in the first and fourth quarters. Fluctuations in seasonal weather conditions may have a significant effect on the result of operations. Sales of electricity are generally less sensitive to weather than natural gas sales, but may also be affected by the weather conditions and the temperature in both the winter and summer seasons.
Catastrophic events could adversely affect the Company’s financial condition and results of operations.
The electric and natural gas utility industries are from time to time affected by catastrophic events, such as unusually severe weather and significant and widespread failures of plant and equipment. Other catastrophic occurrences, such as terrorist attacks on utility facilities, may occur in the future. Such events could inhibit the Company’s ability to deliver electricity or natural gas to its customers for an extended period, which could affect customer satisfaction and adversely affect the Company’s financial condition, results of operations, and cash flows. If customers, legislators, or regulators develop a negative opinion of the Company, this situation could result in increased regulatory oversight and could affect the equity returns that the Company is allowed to earn. Also, if the Company is unable to recover in its rates a significant amount of costs associated with catastrophic events, or if the Company’s recovery of such costs in its rates is significantly delayed, the Company’s financial condition, results or operations, or cash flows may be adversely affected.
The Company’s business could be adversely affected if it is unable to retain its existing customers or attract new customers, or if customers’ demand for its current products and services significantly decreases.
The success of the Company’s business depends, in part, on its ability to maintain and increase its customer base and the demand that those customers have for the Company’s products and services. The Company’s failure to maintain or increase its customer base and/or customer demand for its products and services could adversely affect its financial condition, results of operations, and cash flows.
The electricity and natural gas supply requirements of the Company’s customers are fulfilled by the Company or, in some instances and as allowed by state regulatory authorities, by third-party suppliers who contract directly with customers. In either scenario, significant increases in electricity and natural gas commodity prices may negatively affect the Company’s ability to attract new customers and grow its customer base.
Developments in distributed generation, energy conservation, power generation and energy storage could affect the Company’s revenues and the timing of the recovery of the Company’s costs. Advancements in power generation technology are improving the cost-effectiveness of customer self-supply of electricity. Improvements in energy storage technology, including batteries and fuel cells, could also better position customers to meet their around-the-clock electricity requirements. Such developments could reduce customer purchases of electricity, but may not necessarily reduce the Company’s investment and operating requirements due to the Company’s obligation to serve customers, including those self-supply customers whose equipment has failed for any reason, to provide the power they need. In addition, because a portion of the Company’s costs are recovered through charges based upon the volume of power delivered, reductions in electricity deliveries will affect the timing of the Company’s recovery of those costs and may require changes to the Company’s rate structures.
Item 1B. Unresolved Staff Comments
None.
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Item 1C. Cyber security
For purposes of the following disclosure, the terms “cybersecurity incident” and “cybersecurity threat” have the meanings given to such terms in Item 106 of Regulation S-K promulgated under the Exchange Act.
Risk management and strategy
The Company has a Cybersecurity Plan for assessing, identifying, and managing material risks from cybersecurity threats. The intent of the Cybersecurity Plan is to provide a proactive and systemic approach to meet the evolving requirements for cybersecurity and related compliance in the utility industry. The Cybersecurity Plan’s objectives include:
adopting and using established cybersecurity standards and industry best practices;
protecting personally identifiable information;
protecting infrastructure operations, including Supervisory Control and Data Acquisition (SCADA) systems at electric substations and natural gas plants;
securing customers’, employees’, and the Company’s data;
complying with North American Reliability Corporation Critical Infrastructure Protection Reliability Standards and standards for the protection of Bulk Electric System Cyber Systems; and
continually assessing and, as necessary, enhancing the Company’s cybersecurity through a managed process integrated with the Company’s risk management principles.
The Cybersecurity Plan includes annual assessments using (i) the Department of Energy’s Cybersecurity Capability Maturity Model, (ii) the National Institute of Standards and Technology Cybersecurity Framework, and (iii) the Center for Internet Security Controls. The Company uses the results of these assessments to benchmark the Company’s cybersecurity posture, to identify risks from cybersecurity threats, to prioritize any such risks that may have potential material effects on the Company, and to establish effective controls to manage, mitigate and remediate such risks.
The Cybersecurity Plan is part of the Company’s corporate Enterprise Risk Management (ERM) program. The Company’s ERM program includes an annual review of new or emerging risks (including risks from cybersecurity threats), the assessment of such risks and their potential effects on the Company, the velocity of potential cybersecurity incidents resulting from such risks, and risk mitigation strategies.
The Company maintains a Cybersecurity Employee Awareness Program, which provides targeted education and mandatory quarterly training to employees. The Cybersecurity Employee Awareness Program also conducts monthly phishing test exercises with employees, which includes an escalation procedure for repeated failures. Additionally, the Company performs an annual cyber knowledge assessment of all employees to address any identified knowledge gaps.
The Company engages or otherwise collaborates with cybersecurity consultants, cybersecurity experts , energy sector leaders, and other third parties in connection with the Cybersecurity Plan. Unitil Corporation is also a member of the cyber committees of both the American Gas Association and the Edison Electric Institute.
Third-party entities that provide hardware, software or related support services to the Company or hold the Company’s customer data represent material cybersecurity risks to the Company. To help mitigate those risks, the Company has robust procurement processes and requirements for such third-parties (which include a formal assessment of the third-party’s cyber posture, cyber liability insurance, and breach reporting protocols) that help the Company to oversee and identify cybersecurity risks associated with its use of such third-party entities.
During the fiscal year ended, and as of, December 31, 2025, there were no risks from cybersecurity threats (including as a result of previous cybersecurity incidents) that have materially affected or are reasonably likely to materially affect the Company (including its business strategy, results of operations, or financial condition).
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Governance
The Board is responsible for oversight of the Company’s ERM program, including risks from cybersecurity threats. The Board has not assigned that responsibility to any committee or subcommittee of the Board. The Company’s management generally provides the Board with updates on and assessments of ongoing and emerging risks from cybersecurity threats at regularly scheduled Board meetings.
The Company’s cybersecurity management team is responsible for assessing and managing the Company’s material risks from cybersecurity threats, including implementing the Cybersecurity Plan. The team includes the Company’s Senior Vice President of Shared Services and Director of Information Security and Infrastructure Operations, all of whom have an educational background relevant to, professional experience in, or other expertise in cybersecurity. The Senior Vice President, Shared Services holds a Master of Business Administration and Bachelor of Arts with over 25 years of professional experience leading teams in Human Resources, Supply Chain and Information Technology. The Senior Vice President of Shared Services has overall management responsibility for the Company’s cybersecurity. The Senior Vice President of Shared Services reports to the Company’s President and Chief Administrative Officer . The Director of Information Security and Cyber Operations holds CISSP and ITIL certifications, a Bachelor of Science in Computer Science and a Master’s Certificate in Cybersecurity with a concentration in Power Systems and has over 30 years of experience in the information technology field. The Director of Information Security and Infrastructure Operations also assumes responsibilities as the Company’s Chief Information Security Officer (CISO). The Director of Information Security and Infrastructure Operations has primary responsibility for the cybersecurity program including threat and vulnerability management , vendor security posture assessment, Industrial Control System (ICS) and SCADA infrastructure cybersecurity protection at electric substations and natural gas plants, as well as leading the Cyber Incident Response Team.
The Company’s cybersecurity management team assesses and manages the Company’s material risks from cybersecurity threats through or by:
active monitoring of cyber threat alerts, warnings, advisories, notices, vulnerability assessments, incident bulletins, security briefings, reports and white papers from industry and national organizations, including: downstream Natural Gas Information Sharing and Analysis Center; Electricity Information Sharing and Analysis Center; Cybersecurity and Infrastructure Security Agency; and Federal Bureau of Investigation;
threat and vulnerability management;
vendor security posture assessment;
Industrial Control System and Supervisory Control and Data Acquisition infrastructure cybersecurity protection at electric substations and natural gas plants; and
leading the Company’s Cyber Incident Response Team.
In addition, the Company uses (i) a Security Operations Center vendor with 24x7 monitoring and response capabilities to identify any suspicious activity on the Company’s networks and (ii) a security consulting firm for assessments, penetration testing and incident response. In the event of a cybersecurity threat, the CISO and these parties would collaborate to assess and manage the risk with ultimate responsibility residing with the Board.
Also, in the event of a cybersecurity threat or cybersecurity incident, the Company’s cybersecurity management team will investigate and perform impact analysis and, as necessary, the CISO will activate the Company’s Cyber Incident Response Team. The Cyber Incident Response Team is a subset of the Company’s Crisis Response Team, which has responsibility for operational and business resilience, as well as tactical and strategic response. A foundational aspect of the Crisis Response Team is prompt and comprehensive communications to all concerned parties, both internal and external, including direction for management to inform the Board about risks from cybersecurity threats.
The Company’s determination of the materiality of a cybersecurity incident would generally include an evaluation of the incident’s effect on the Company (including (i) its business strategy, results of operations, or financial condition, (ii) the integrity, confidentiality, resiliency, and security of the Company’s networks and systems, and (iii) the Company’s operations).
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Item 2. Properties
As of December 31, 2025, Unitil owned through its natural gas and electric distribution utilities, seven utility operating centers located in New Hampshire, Maine and Massachusetts. The Company’s real estate subsidiary, Unitil Realty, owns the Company’s corporate headquarters building and the land on which it is located in Hampton, New Hampshire. Unitil Realty also owns land in Kingston, New Hampshire on which Unitil Energy’s solar facility is located that became operational in May 2025.
The following tables detail certain of the Company’s electric and natural gas operations properties.
Electric Operations
Description
Unitil Energy
Fitchburg
Total
Primary Transmission and Distribution Pole Miles—Overhead
Conduit Distribution Bank Miles—Underground
Transmission and Distribution Substations*
Transformer Capacity of Transmission and Distribution Substations** (MVA)
* Includes locations that are normally in-service sources of distribution circuits through the use of transformer(s).
** Does not include load served directly from sub-transmission.
Natural Gas Operations
Northern Utilities
Description
Fitchburg
Bangor
Maine Natural
Granite State
Total
Underground Natural Gas Mains—Miles
Natural Gas Transmission Pipeline—Miles
Service Pipes
Unitil Energy’s electric substations are located on land owned by Unitil Energy or land occupied by Unitil Energy pursuant to perpetual easements in the southeastern seacoast and state capital regions of New Hampshire . Unitil Energy’s electric distribution lines are located in, on or under public highways or private lands pursuant to lease, easement, permit, municipal consent, tariff conditions, agreement or license, expressed or implied through use by Unitil Energy without objection by the owners. In the case of certain distribution lines, Unitil Energy owns only a part interest in the poles upon which its wires are installed, the remaining interest being owned by telecommunication companies.
The physical utility properties of Unitil Energy, with certain exceptions, and its franchises are subject to its indenture of mortgage and deed of trust under which the respective series of first mortgage bonds of Unitil Energy are outstanding.
Fitchburg’s electric substations, with minor exceptions, are located in north central Massachusetts on land owned by Fitchburg or occupied by Fitchburg pursuant to perpetual easements. Fitchburg’s electric distribution lines and gas mains are located in, on, or under public highways or private lands pursuant to lease, easement, permit, municipal consent, tariff conditions, agreement or license, express or implied through use by Fitchburg without objection by the owners. Fitchburg owns full interest in the poles upon which its wires are installed.
The Company’s natural gas operations property includes two liquefied propane gas plants and two liquid natural gas plants. Northern Utilities also owns a propane air gas plant and an LNG storage and vaporization facility. Fitchburg owns a propane air gas plant and an LNG storage and vaporization facility, both of which are located on land owned by Fitchburg in north central Massachusetts.
Northern Utilities’ gas mains are primarily made up of polyethylene plastic (84.8%) and coated and wrapped cathodically protected steel (15.2%). FG&E’s gas mains are primarily made up of polyethylene plastic (49.5%), coated steel (42.9%), cast iron (6.6%), bare steel (0.9%), and wrought and ductile iron (0.1%). Bangor’s gas mains are primarily made up of polyethylene plastic (70.2%), coated and wrapped cathodically protected steel (29.6%), and unprotected bare and coated steel (0.2%). Maine Natural’s gas mains are primarily made up of polyethylene plastic (89.4%), and coated and wrapped cathodically protected steel (10.6%).
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Granite State’s underground natural gas transmission pipeline, regulated by the FERC, is located primarily in Maine and New Hampshire.
The Company believes that its facilities are currently adequate for their intended uses.
Item 3. Legal Proceedings
The Company is involved in legal and administrative proceedings and claims of various types, including those which arise in the ordinary course of business. The Company believes, based upon information furnished by counsel and others, that the ultimate resolution of these claims will not have a material effect on its financial position, operating results or cash flows.
Item 4. Mine Safety Disclosures
Not applicable.
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PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Common Stock Information
The Company’s common stock is listed on the New York Stock Exchange under the symbol “UTL”. As of December 31, 2025, there were 1,078 shareholders of record of the Company’s common stock.
Dividend Information
Information regarding dividend payments by the Company to the Company’s shareholders for the year ended December 31, 2025 as compared to the year ended December 31, 2024, is set forth in the following table.
Dividends per Common Share
1st Quarter
2nd Quarter
3rd Quarter
4th Quarter
Total for Year
See “Dividends” in Part II, Item 7 (Management’s Discussion and Analysis of Financial Condition and Results of Operations).
Equity Compensation Plan Information
Information regarding securities authorized for issuance under the Company’s equity compensation plans, as of December 31, 2025, is set forth in the following table.
Plan Category
Number of securities
to be issued upon exercise
of outstanding options,
warrants and rights
Weighted-average
exercise price of
outstanding options,
warrants and rights
Number of securities
remaining available for
future issuance under
equity compensation
plans (excluding
securities reflected in
column (a))
Equity compensation plans approved by security holders (1)
Equity compensation plans not approved by security holders
Total
NOTES: (also see Note 5 (Equity) to the accompanying Consolidated Financial Statements)
Consists of the Third Amended and Restated 2003 Stock Plan (as amended and restated, the “Plan”). On April 19, 2012, shareholders initially approved the Plan, and a total of 677,500 shares of the Company’s common stock were reserved for issuance pursuant to awards of restricted stock, restricted stock units and common stock under the Plan. On May 1, 2024, shareholders approved an additional 350,000 shares of the Company’s common stock to be reserved for issuance pursuant to awards of restricted stock, restricted stock units and common stock under the Plan. A total of 639,505 shares of restricted stock have been awarded and 66,797 restricted stock units have been settled and issued as shares of common stock by Plan participants through December 31, 2025. As of December 31, 2025, a total of 15,200 shares of restricted stock were forfeited and once again became available for issuance under the Plan.
Stock Performance Graph
The following graph compares Unitil Corporation’s cumulative stockholder return since December 31, 2020 with the Peer Group index, comprised of the S&P 500 Utilities Index, and the S&P 500 index. The graph assumes that the value of the investment in the Company’s common stock and each index (including reinvestment of dividends) was $100 on December 31, 2020.
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NOTE:
The graph above assumes $100 invested on December 31, 2020, in each category and the reinvestment of all dividends during the five-year period. The Peer Group is comprised of the S&P 500 Utilities Index.
Unregistered Sales of Equity Securities and Uses of Proceeds
There were no sales of unregistered equity securities by the Company for the fiscal period ended December 31, 2025.
Issuer Purchases of Equity Securities
There were no purchases of equity securities by the Company for the quarter ended December 31, 2025.
Item 6. Reserved
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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) (Note references are to the Notes to the Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.)
You should read the following discussion and analysis together with the consolidated financial statements and related notes included elsewhere herein.
OVERVIEW
Unitil is a public utility holding company headquartered in Hampton, New Hampshire. Unitil is subject to regulation as a holding company system by the FERC under the Energy Policy Act of 2005.
Unitil’s principal business is the local distribution of electricity and natural gas to approximately 215,100 customers throughout its service territory in the states of New Hampshire, Massachusetts and Maine. Unitil is the parent company of five wholly-owned distribution utilities:
Unitil Energy, which provides electric service in the southeastern seacoast and state capital regions of New Hampshire;
Fitchburg, which provides both electric and natural gas service in the greater Fitchburg area of north central Massachusetts;
iii)
Northern Utilities, which provides natural gas service in southeastern New Hampshire and portions of southern and central Maine, including the city of Portland and the Lewiston-Auburn area;
Bangor, which provides natural gas service in the greater Bangor area of central Maine; and
Maine Natural, which provides natural gas service in southern and central Maine, including the greater Portland region, as well as the capital city of Augusta.
Unitil Energy, Fitchburg, Northern Utilities, Bangor and Maine Natural are collectively referred to as the “distribution utilities.” Together, the distribution utilities serve approximately 110,100 electric customers and 105,000 natural gas customers in their service territories. The distribution utilities are local “wires and pipes” operating companies.
In addition, Unitil is the parent company of Granite State, a natural gas transmission pipeline, regulated by the FERC, operating 85 miles of underground gas transmission pipeline primarily located in Maine and New Hampshire. Granite State provides Northern Utilities with interconnection to three major natural gas pipelines and access to North American pipeline supplies.
Unitil had an investment in Net Utility Plant of $1.8 billion at December 31, 2025. Unitil’s total revenue was $536.0 million in 2025, which includes revenue to recover the approved cost of purchased electricity and natural gas in rates on a fully reconciling basis. As a result of this reconciling rate structure, the Company’s earnings are not affected by changes in the cost of purchased electricity and natural gas. Earnings from Unitil’s utility operations are derived from the return on investment in the five distribution utilities and Granite State.
The Company’s other subsidiaries include Unitil Service, which provides, at cost, a variety of administrative and professional services to Unitil’s affiliated companies, Unitil Resources, the Company’s non-regulated subsidiary, which currently does not have any activity, Unitil Realty, which owns and manages the Company’s corporate office in Hampton, New Hampshire and also owns land in Kingston, New Hampshire on which Unitil Energy’s solar facility is located, which became operational in May 2025, and Unitil Water which currently does not have any activity. Unitil’s consolidated net income includes the earnings of the holding company and these subsidiaries.
Regulation
Unitil is subject to comprehensive regulation by federal and state regulatory authorities. Unitil and its subsidiaries are subject to regulation as a holding company system by the FERC under the Energy Policy Act of 2005 with regard to certain bookkeeping, accounting and reporting requirements. Unitil’s utility operations related to wholesale and interstate energy business activities are also regulated by the FERC. Unitil’s distribution utilities are subject to regulation by the applicable state public utility commissions, with regard to their rates, issuance of securities and other accounting and operational matters: Unitil
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Energy is subject to regulation by the NHPUC; Fitchburg is subject to regulation by the MDPU; Northern Utilities is regulated by the NHPUC and MPUC; and Bangor and Maine Natural are regulated by the MPUC. Granite State, Unitil’s interstate natural gas transmission pipeline, is subject to regulation by the FERC with regard to its rates and operations. Because Unitil’s primary operations are subject to rate regulation, the regulatory treatment of various matters could significantly affect the Company’s operations, financial position, and cash flows.
Unitil Energy, Fitchburg, Northern Utilities and Maine Natural’s non-Augusta service area deliver electricity and/or natural gas to all customers in their service territories, at rates established under traditional cost of service regulation. Under this regulatory structure, Unitil’s distribution utilities are provided the opportunity to recover the cost of providing distribution service to their customers based on a historical or forward test year, and earn a return on their capital investment in utility assets. In addition, the Company’s distribution utilities and its natural gas transmission pipeline company also may recover certain base rate costs, including capital project spending and enhanced reliability and vegetation management programs, through annual step adjustments and cost tracker rate mechanisms. Bangor and Maine Natural’s Augusta Service Area deliver natural gas customers at rates established under alternative rate plans, which provide multi-year rate changes designed to approximate market-based rates.
Most of Unitil’s customers have the opportunity to purchase their electricity or natural gas supplies from third-party energy suppliers. For customers that choose not to participate in the third-party energy supplier market, Unitil acts as a provider of last resort. Unitil’s distribution utilities purchase electricity or natural gas from unaffiliated wholesale energy suppliers and recover the actual approved costs of these supplies on a pass-through basis, through reconciling rate mechanisms that are periodically adjusted.
The Company’s electric and gas sales in Massachusetts and New Hampshire are decoupled. Revenue decoupling is the term given to the elimination of the dependency of a utility’s distribution revenue on the volume of electricity or gas sales. The difference between distribution revenue amounts billed to customers and the targeted revenue decoupling amounts is recognized as an increase or a decrease in Accrued Revenue, which forms the basis for resetting rates for future cash recoveries from, or credits to, customers. These revenue decoupling targets may be adjusted as a result of rate cases and other authorized adjustments that the Company files with the MDPU and NHPUC.
Also see Regulatory Matters in this section and Note 8 (Commitments and Contingencies) to the accompanying Consolidated Financial Statements for additional information on rates and regulation.
RESULTS OF OPERATIONS
The following discussion of the Company’s financial condition and results of operations should be read in conjunction with the accompanying Consolidated Financial Statements and the accompanying Notes to Consolidated Financial Statements included in Part II, Item 8 of this report.
The Company’s results of operations are expected to reflect the seasonal nature of the natural gas business. Annual gas revenues are substantially realized during the colder weather seasons of the year as a result of higher sales of natural gas used for heating-related purposes. Accordingly, the results of operations are historically most favorable in the first and fourth quarters. Fluctuations in seasonal weather conditions may have a significant effect on the result of operations. Sales of electricity are generally less sensitive to weather than natural gas sales, but may also be affected by weather conditions and the temperature in the winter and summer seasons.
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Use of GAAP and Non-GAAP Financial Measures
The MD&A includes financial information prepared in accordance with generally accepted accounting principles in the United States (GAAP), as well as certain non-GAAP financial measures. The Company's management believes that the non-GAAP presentations of earnings and Earnings Per Share (EPS) and Electric and Gas Adjusted Gross Margins are a more meaningful representation of the Company's financial performance and provide additional and useful information to readers of this report in analyzing the historical and future performance of the business. The non-GAAP financial measures should be viewed as a supplement to, and not a substitute for, financial measures presented in accordance with GAAP. Non-GAAP measures as presented herein may not be comparable to similarly titled measures used by other companies.
The Company's earnings discussion includes Adjusted Net Income, a non-GAAP financial measure referencing the Company’s 2025 GAAP Net Income adjusted for certain transaction costs related to the Company's acquisitions of Bangor Natural Gas Company (transaction closed on January 31, 2025), Maine Natural Gas Corporation (transaction closed on October 31, 2025), Aquarion Water Company of Massachusetts, Inc., Aquarion Water Company of New Hampshire, Inc., and Abenaki Water Co., Inc. (the Aquarion Companies) (pending certain regulatory approvals and satisfaction of closing conditions). The Company's management believes that the transaction costs related to the acquisitions of Bangor, Maine Natural and the Aquarion Companies, which are included in Operation and Maintenance expense on the Consolidated Statements of Earnings, are not indicative of the Company's ongoing costs and not directly related to the ongoing operations of the business and therefore are not an indicator of baseline operating performance.
In the following tables the Company has reconciled Adjusted Net Income to GAAP Net Income, which we believe to be the most comparable GAAP financial measure.
(Millions, except per share data)
Twelve Months Ended December 31, 2025
Amount
Per Share
GAAP Net Income
Transaction Costs
Adjusted Net Income
Twelve Months Ended December 31, 2024
Amount
Per Share
GAAP Net Income
Transaction Costs
Adjusted Net Income
Twelve Months Ended December 31, 2023
Amount
Per Share
GAAP Net Income
Transaction Costs
Adjusted Net Income
The Company analyzes operating results using Electric and Gas Adjusted Gross Margins, which are non-GAAP financial measures. Electric Adjusted Gross Margin is calculated as Total Electric Operating Revenue less Cost of Electric Sales. Gas Adjusted Gross Margin is calculated as Total Gas Operating Revenues less Cost of Gas Sales. The Company’s management believes Electric and Gas Adjusted Gross Margins provide useful information to investors regarding profitability. Also, the Company’s management believes Electric and Gas Adjusted Gross Margins are important financial measures to analyze revenue from the Company’s ongoing operations because the approved cost of electric and gas sales are tracked, reconciled and passed through directly to customers in electric and gas tariff rates, resulting in an equal and offsetting amount reflected in Total Electric and Gas Operating Revenue.
In the following tables the Company has reconciled Electric and Gas Adjusted Gross Margin to GAAP Gross Margin, which we believe to be the most comparable GAAP financial measure. GAAP Gross Margin is calculated as Revenue less Cost of Sales, and Depreciation and Amortization. The Company calculates Electric and Gas Adjusted Gross Margin as Revenue less Cost of Sales. The Company believes excluding Depreciation and Amortization, which are period costs and not related to
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volumetric sales, is a meaningful financial measure to inform investors of the Company’s profitability from electric and gas sales in the period.
Twelve Months Ended December 31, 2025 ($ millions)
Electric
Gas
Other
Total
Total Operating Revenue
Less: Cost of Sales
Less: Depreciation and Amortization
GAAP Gross Margin
Depreciation and Amortization
Adjusted Gross Margin
Twelve Months Ended December 31, 2024 ($ millions)
Electric
Gas
Other
Total
Total Operating Revenue
Less: Cost of Sales
Less: Depreciation and Amortization
GAAP Gross Margin
Depreciation and Amortization
Adjusted Gross Margin
Twelve Months Ended December 31, 2023 ($ millions)
Electric
Gas
Other
Total
Total Operating Revenue
Less: Cost of Sales
Less: Depreciation and Amortization
GAAP Gross Margin
Depreciation and Amortization
Adjusted Gross Margin
Electric GAAP Gross Margin was $82.7 million in 2025, an increase of $4.7 million compared to 2024. The increase was driven by higher rates and customer growth of $7.3 million, partially offset by higher depreciation and amortization expense of $2.6 million.
Electric GAAP Gross Margin was $78.0 million in 2024, a decrease of $0.1 million compared to 2023. The decrease was driven by higher depreciation and amortization expense of $3.3 million, largely offset by higher rates and customer growth of $3.2 million.
Gas GAAP Gross Margin was $142.3 million in 2025, an increase of $22.2 million compared to 2024. The increase was driven primarily by higher rates and customer growth of $32.2 million, partially offset by higher depreciation and amortization of $10.0 million. The increases attributable to Bangor and Maine Natural for gas operating revenue, cost of gas sales and depreciation and amortization for 2025 were $36.2 million, $19.6 million and $3.3 million, respectively.
Gas GAAP Gross Margin was $120.1 million in 2024, an increase of $6.0 million compared to 2023. The increase was driven primarily by higher rates, and customer growth, of $12.4 million, partially offset by higher depreciation and amortization of $6.4 million.
Net Income and EPS Overview
2025 Compared to 2024— The Company’s GAAP Net Income was $50.2 million, or $2.97 in Earnings Per Share (EPS), for the year ended December 31, 2025, an increase of $3.1 million in Net Income, or $0.04 in EPS, compared to 2024. The Company’s Adjusted Net Income (a non-GAAP financial measure) was $53.3 million, or $3.16 in EPS for the year ended December 31, 2025, an increase of $5.5 million, or $0.19 in EPS, compared to 2024. The Company’s earnings in 2025 reflect higher rates and customer growth.
Electric Adjusted Gross Margin (a non-GAAP financial measure) was $114.6 million in 2025, an increase of $7.3 million compared with 2024. The increase was driven by higher rates and customer growth.
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Gas Adjusted Gross Margin (a non-GAAP financial measure) was $199.1 million in 2025, an increase of $32.2 million compared to 2024. The increase was driven primarily by higher rates, and customer growth. Gas Adjusted Gross Margin included $16.6 million related to Bangor and Maine Natural in 2025.
Operation and Maintenance (O&M) expenses increased $14.9 million in 2025 compared to 2024, reflecting higher utility operating costs of $6.1 million, higher labor and other costs of $5.5 million and higher acquisition costs of $3.3 million. O&M expenses included $4.2 million of utility operating costs for Bangor and Maine Natural in 2025.
Depreciation and Amortization expense increased $12.6 million in 2025 compared to 2024, reflecting higher depreciation rates from recent base rate cases, additional depreciation associated with higher levels of utility plant in service and higher amortization of other deferred costs. Depreciation and Amortization expense included $3.3 million related to Bangor and Maine Natural in 2025.
Taxes Other Than Income Taxes increased $1.4 million in 2025 compared to 2024, reflecting higher local property taxes on higher utility plant in service associated with the Company’s completed acquisitions of Bangor and Maine Natural.
Interest Expense, Net increased $7.4 million in 2025 compared to 2024 primarily reflecting higher interest on higher levels of debt from the acquisitions of Bangor and Maine Natural and lower interest income on regulatory assets and allowance for funds used during construction.
Other Expense (Income), Net decreased $1.2 million in 2025 compared to 2024, reflecting lower retirement benefit costs.
Federal and State Income Taxes increased $1.3 million in 2025 compared to 2024, reflecting higher pre-tax earnings in 2025.
In 2025, Unitil’s annual common dividend was $1.80 per share, representing an unbroken record of quarterly dividend payments since trading began in Unitil’s common stock. At a January 2026 meeting of the Unitil Corporation Board of Directors (the “Board”), the Board declared a quarterly dividend on the Company’s common stock of $0.475 per share, an increase of $0.025 per share on a quarterly basis, resulting in an increase in the effective annualized dividend rate to $1.90 per share from $1.80 per share.
2024 Compared to 2023— The Company’s GAAP Net Income was $47.1 million, or $2.93 in EPS, for the year ended December 31, 2024, an increase of $1.9 million in Net Income, or $0.11 in EPS, compared to 2023. The Company’s Adjusted Net Income (a non-GAAP financial measure) was $47.8 million, or $2.97 in EPS, for the year ended December 31, 2024, an increase of $2.6 million, or $0.15 in EPS, compared to 2023. The Company’s earnings in 2024 reflect higher rates and customer growth.
Electric Revenues, Adjusted Gross Margin and Sales
Electric Operating Revenues and Electric Adjusted Gross Margin (a non-GAAP financial measure) —The following table details Total Electric Operating Revenue and Electric Adjusted Gross Margin for the last three years by major customer class:
Change
Electric Operating Revenues and Electric Adjusted Gross Margin
(millions)
Electric Operating Revenue:
Residential
Commercial & Industrial
Total Electric Operating Revenue
Cost of Electric Sales
Electric Adjusted Gross Margin
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The decrease in Total Electric Operating Revenue of $11.9 million, or 4.8%, in 2025 compared to 2024 reflects lower costs of electric sales due to the increase in the amount of electricity purchased by customers directly from third-party suppliers, which are tracked and reconciled costs as a pass-through to customers, partially offset by higher electric distribution rates.
Electric GAAP Gross Margin is discussed above in the section entitled “Use of GAAP and Non-GAAP Financial Measures”.
Electric Adjusted Gross Margin (a non-GAAP financial measure) was $114.6 million in 2025, an increase of $7.3 million compared with 2024. The increase was driven by higher rates and customer growth.
The decrease in Total Electric Operating Revenue of $58.2 million, or 19.0%, in 2024 compared to 2023 reflects lower costs of electric sales, which are tracked and reconciled costs as a pass-through to customers, partially offset by higher electric distribution rates.
Electric Adjusted Gross Margin (a non-GAAP financial measure) was $107.3 million in 2024, an increase of $3.2 million compared with 2023. The increase was driven by higher rates and customer growth.
Kilowatt-hour Sales— Unitil’s total electric kilowatt-hour (kWh) sales decreased 0.6% in 2025 compared to 2024. Sales to Residential customers increased 4.1% reflecting colder weather for heating purposes in the first and fourth quarter of 2025 compared to the same periods in 2024 and customer growth, partially offset by cooler weather for cooling purposes in the third quarter of 2025 compared to the same period in 2024. Sales to C&I customers decreased 4.0% in 2025 compared to 2024, reflecting the loss of a large industrial customer in the Fitchburg area in 2025, partially offset by customer growth. Based on weather data collected in the Company’s electric service areas, on average there were 13.7% more Heating Degree days and 6.6% less Cooling Degree Days in 2025 compared to 2024. As of December 31, 2025, the number of electric customers served increased by approximately 610 over the previous year. Sales margins derived from decoupled unit sales are not sensitive to changes in electric kWh sales, although those sales margins are sensitive to changes in the number of customers served. Substantially all of the Company's electric kWh sales volumes are decoupled.
Unitil’s total electric kWh sales increased 1.3% in 2024 compared to 2023. Sales to Residential customers increased 1.6% and sales to C&I customers increased 1.1% in 2024 compared to 2023, reflecting warmer weather for cooling purposes in the second quarter of 2024 compared to the same period in 2023, and customer growth. Based on weather data collected in the Company’s electric service areas, on average there were 12.2% more Cooling Degree Days in 2024 compared to 2023. As of December 31, 2024, the number of electric customers served increased by approximately 990 over the previous year.
The following table details total kWh sales for the last three years by major customer class:
Change
kWh Sales (millions)
kWh
kWh
Residential
Commercial & Industrial
Total kWh Sales
Gas Revenues, Adjusted Gross Margin and Sales
Gas Operating Revenues and Adjusted Gross Margin (a non-GAAP financial measure) — The following table details total Gas Operating Revenue and Gas Adjusted Gross Margin for the last three years by major customer class:
Change
Gas Operating Revenues and Gas Adjusted Gross Margin
(millions)
Gas Operating Revenue:
Residential
Commercial & Industrial
Total Gas Operating Revenue
Cost of Gas Sales
Gas Adjusted Gross Margin
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The increase in Total Gas Operating Revenues of $53.1 million, or 21.5%, in 2025 compared to 2024 reflects $36.2 million of sales for Bangor and Maine Natural, higher gas distribution rates and customer growth, the favorable impact of colder winter weather in 2025 and higher costs of gas sales, which are tracked and reconciled as a pass-through to customers.
Gas GAAP Gross Margin is discussed above in the section entitled “Use of GAAP and Non-GAAP Financial Measures”.
Gas Adjusted Gross Margin (a non-GAAP financial measure) was $199.1 million in 2025, an increase of $32.2 million compared to 2024. The increase includes $16.6 million for Bangor and Maine Natural, higher rates gas distribution rates, the favorable impact of winter weather in 2025 and customer growth.
The decrease in Total Gas Operating Revenues of $4.1 million, or 1.6%, in 2024 compared to 2023 reflects lower costs of gas sales, which are tracked and reconciled as a pass-through to customers, and lower sales of gas, partially offset by higher gas distribution rates.
Gas Adjusted Gross Margin (a non-GAAP financial measure) was $166.9 million in 2024, an increase of $12.4 million compared to 2023. The increase was driven primarily by higher rates, and customer growth.
Therm Sales —Unitil’s total gas therm sales increased 26.6% in 2025 compared to 2024. Sales to Residential customers increased 34.0% and sales to C&I customers increased 24.8% in 2025 compared to 2024, reflecting colder winter weather and customer growth. Total gas therm sales included 40.0 million therms related to Bangor and Maine Natural in 2025. Based on weather data collected in the Company’s gas service areas, on average there were 12.2% higher Effective Degree Days (EDD) in 2025 compared to 2024. The Company estimates weather-normalized gas therm sales for Northern Utilities' Maine division, the Company's largest non-decoupled gas service area, increased 3.5% in 2025 compared to 2024. As of December 31, 2025, the number of gas customers served increased by approximately 15,930 over the previous year, with 15,360 customers at Bangor and Maine Natural. Sales margins derived from decoupled unit sales (currently representing approximately 38% of total annual therm sales volume) are not sensitive to changes in gas therm sales, although those sales margins are sensitive to changes in the number of customers served. In 2025, there were 2.7% more EDD than normal. In 2024, there were 9.5% fewer EDD than normal.
Unitil’s total gas therm sales decreased 0.7% in 2024 compared to 2023. Sales to Residential customers decreased 1.4% and sales to C&I customers decreased 0.5% in 2024 compared to 2023, reflecting lower average usage, partially offset by customer growth. As of December 31, 2024, the number of gas customers served increased by approximately 730 over the previous year. Sales margins derived from decoupled unit sales (currently representing approximately 43% of total annual therm sales volume) are not sensitive to changes in gas therm sales, although those sales margins are sensitive to changes in the number of customers served. In 2024 and 2023, there were 9.5% and 11.0% fewer Effective Degree Days (EDD) than normal, respectively.
The following table details total therm sales for the last three years, by major customer class:
Change
Therm Sales (millions)
Therms
Therms
Residential
Commercial & Industrial
Total Therm Sales
The Company transported 53.1 million therms in 2025 to two electric generation facilities in Maine. As these facilities were charged fixed fees and utilized third-party energy suppliers for natural gas, the therms were not included in the above table.
Operating Expenses
Cost of Electric Sales —Cost of Electric Sales includes the cost of electric supply as well as other energy supply related costs and spending on energy efficiency programs. Cost of Electric Sales decreased $19.2 million, or 13.6%, in 2025 compared to 2024. This decrease reflects an increase in the amount of electricity purchased by customers directly from third-party
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suppliers, partially offset by higher wholesale electricity prices. The Company reconciles and recovers the approved Cost of Electric Sales in its rates at cost on a pass through basis and therefore changes in approved expenses do not affect earnings.
In 2024, Cost of Electric Sales decreased $61.4 million, or 30.3%, compared to 2023. This decrease reflects lower wholesale electricity prices and an increase in the amount of electricity purchased by customers directly from third-party suppliers, partially offset by higher electric sales.
Cost of Gas Sales— Cost of Gas Sales includes the cost of natural gas purchased to supply the Company’s total gas supply requirements as well as other energy supply related costs and spending on energy efficiency programs. Cost of Gas Sales increased $20.9 million, or 26.3%, in 2025 compared to 2024. This increase reflects higher gas sales primarily from the Bangor and Maine Natural acquisitions. The Company reconciles and recovers the approved Cost of Gas Sales in its rates at cost on a pass through basis and therefore changes in approved expenses do not affect earnings.
In 2024, Cost of Gas Sales decreased $16.5 million, or 17.2%, compared to 2023. This decrease reflects lower gas sales, lower wholesale gas commodity prices and an increase in the amount of gas purchased by customers directly from third-party suppliers.
Operation and Maintenance— O&M expense includes electric and gas utility operating costs, and the operating costs of the Company’s other subsidiaries. Total O&M expenses increased $14.9 million, or 19.2%, in 2025 compared to 2024, reflecting higher utility operating costs of $6.1 million, higher labor and other costs of $5.5 million and higher acquisition costs of $3.3 million. O&M expenses included $4.2 million of utility operating costs for Bangor and Maine Natural in 2025.
In 2024, total O&M expenses increased $2.0 million, or 2.6%, compared to 2023, reflecting higher labor costs of $2.5 million, partially offset by lower utility operating costs of $0.5 million.
Depreciation and Amortization— Depreciation and Amortization expense increased $12.6 million, or 16.6%, in 2025 compared to 2024, reflecting higher depreciation rates from recent base rate cases, additional depreciation associated with higher levels of utility plant in service and higher amortization of other deferred costs. Depreciation and Amortization expense included $3.3 million related to Bangor and Maine Natural in 2025.
In 2024, Depreciation and Amortization expense increased $8.7 million, or 12.9%, compared to 2023, reflecting higher depreciation rates from recent base rate cases, additional depreciation associated with higher levels of utility plant in service and higher amortization of rate case and other deferred costs.
Taxes Other Than Income Taxes— Taxes Other Than Income Taxes increased $1.4 million, or 4.7%, in 2025 compared to 2024, reflecting higher local property taxes on higher utility plant in service associated with the Company’s completed acquisitions of Bangor and Maine Natural.
In 2024, Taxes Other Than Income Taxes increased $1.4 million, or 4.9%, compared to 2023, reflecting higher local property taxes on higher utility plant in service and higher payroll taxes.
Interest Expense, Net— Interest expense is presented in the Consolidated Financial Statements net of interest income. Interest expense is mainly comprised of interest on long-term debt and short-term borrowings (See Note 4 (Debt and Financing Arrangements) to the accompanying Consolidated Financial Statements). Certain reconciling rate mechanisms used by the Company’s distribution utilities give rise to regulatory assets and regulatory liabilities on which interest is calculated.
Interest Expense, Net increased $7.4 million, or 25.3%, in 2025 compared to 2024 primarily reflecting higher interest on higher levels of debt from the acquisitions of Bangor and Maine Natural and lower interest income on regulatory assets and allowance for funds used during construction.
Interest Expense, Net increased $0.6 million, or 2.1%, in 2024 compared to 2023 primarily reflecting higher interest on higher levels of long-term debt and higher interest on short-term borrowings, partially offset by higher interest income on regulatory assets and other.
Other (Income) Expense, Net— Other Expense (Income), Net decreased $1.2 million in 2025 compared to 2024, reflecting lower retirement benefit costs.
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Other Expense (Income), Net increased $0.2 million in 2024 compared to 2023, reflecting lower retirement benefit costs.
Provision for Income Taxes— Federal and State Income Taxes increased $1.3 million in 2025 compared to 2024, reflecting higher pre-tax earnings in 2025.
Federal and State Income Taxes increased $0.8 million in 2024 compared to 2023, reflecting higher pre-tax earnings in 2024.
LIQUIDITY, COMMITMENTS AND CAPITAL REQUIREMENTS
Sources of Capital
Unitil requires capital to fund utility plant additions, working capital and other utility expenditures recovered in subsequent periods through regulated rates. The capital necessary to meet these requirements is derived primarily from internally generated funds, which consist of cash flows from operating activities. The Company initially supplements internally generated funds through short-term bank borrowings, as needed, under its unsecured revolving Credit Facility. Periodically, the Company replaces portions of its short-term debt with long-term financings more closely matched to the long-term nature of its utility assets. Additionally, from time to time the Company has accessed the public capital markets through public offerings of equity securities. The Company’s utility operations are seasonal in nature and are therefore subject to seasonal fluctuations in cash flows. The amount, type and timing of any future financing will vary from year to year based on capital needs and maturity or redemptions of securities.
On August 18, 2025, the Company issued and sold 1,602,358 shares of its common stock at a price of $46.65 per share in a registered public offering (Offering). The Company’s net increase to Common Equity and Cash proceeds from the Offering was approximately $71.8 million. The proceeds were used to make equity capital contributions to the Company’s regulated utility subsidiaries, to repay debt and for other general corporate purposes. Overall, the results of operations and earnings in 2025 reflect the higher number of average shares outstanding.
On June 3, 2025, the Company entered into an at-the-market equity offering program (the ATM program) with sales agents under which the Company may, from time to time, offer and sell shares of Unitil's common stock having an aggregate offering price of up to $50 million. Sales of common stock under the ATM program, if any, are made pursuant to a shelf registration statement on Form S-3 (File No. 333-287753) and a related prospectus supplement filed with the Securities and Exchange Commission. As of December 31, 2025, the Company had sold an aggregate of 27,620 shares under the ATM program for net proceeds of $1.4 million. As of December 31, 2025, approximately $48.5 million remains available for future sales under the program.
The Company and its subsidiaries are individually and collectively members of the Unitil Cash Pool (Cash Pool). The Cash Pool is the financing vehicle for day-to-day cash borrowing and investing. The Cash Pool allows for an efficient exchange of cash among the Company and its subsidiaries. The interest rates charged to the subsidiaries for borrowing from the Cash Pool are based on actual interest costs from lenders under the Company’s revolving Credit Facility. At December 31, 2025 and December 31, 2024, the Company and all of its subsidiaries were in compliance with the regulatory requirements governing participation in the Cash Pool.
On September 29, 2022, the Company entered into a Third Amended and Restated Credit Agreement with a syndicate of lenders (collectively, the “Credit Facility”), which amended and restated the prior facility in full, and on January 29, 2025, the Company executed an amendment that increased the borrowing limit from $200 million to $275 million and extended the maturity date from September 29, 2027 to September 29, 2028. Unitil may borrow under the Credit Facility through September 29, 2028, with the option for two additional one‑year extensions under certain conditions. The Credit Facility provides for a $275 million borrowing limit, including a $25 million sublimit for standby letters of credit, and permits Unitil to increase the borrowing limit by up to an additional $75 million under certain circumstances. Borrowings under the Credit Facility may bear interest at various rate options, including a daily fluctuating rate equal to the forward‑looking one‑month SOFR term rate (as administered by the Federal Reserve Bank of New York), plus 0.1000%, plus a margin ranging from 1.125% to 1.375% based on Unitil’s credit rating.
The Company utilizes the Credit Facility for cash management purposes related to its short-term operating activities. Total gross borrowings were $476.4 million and $308.4 million for the years ended December 31, 2025 and December 31,
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2024, respectively. Total gross repayments were $412.5 million and $364.6 million for the years ended December 31, 2025 and December 31, 2024, respectively. The following table details the borrowing limits, amounts outstanding and amounts available under the revolving Credit Facility as of December 31, 2025 and December 31, 2024:
December 31,
Revolving Credit Facility (millions)
Limit
Short-Term Borrowings Outstanding
Available
The Credit Facility contains customary terms and conditions for credit facilities of this type, including affirmative and negative covenants. There are restrictions on, among other things, Unitil’s and its subsidiaries’ ability to permit liens or incur indebtedness, and restrictions on Unitil’s ability to merge or consolidate with another entity or change its line of business. The affirmative and negative covenants under the Credit Facility shall apply to Unitil until the Credit Facility terminates and all amounts borrowed under the Credit Facility are paid in full (or with respect to letters of credit, they are cash collateralized).
The only financial covenant in the Credit Facility provides that Unitil’s Funded Debt to Capitalization (as each term is defined in the Credit Facility) cannot exceed 65%, tested on a quarterly basis. At December 31, 2025 and December 31, 2024, the Company was in compliance with the covenants contained in the Credit Facility in effect on that date. (See also “Credit Arrangements” in Note 4 Debt and Financing Arrangements.)
On October 31, 2025, the Company entered into a senior unsecured delayed-draw term loan facility with The Bank of Nova Scotia. The proceeds of the $86.0 million facility were used to initially fund the acquisition of Maine Natural on October 31, 2025. The facility provides that the Company has an option for determining whether interest on loans under the facility will bear interest based on a Base Rate plus an applicable margin of 0.25% or based on a one month Term SOFR plus a SOFR adjustment of 0.10% plus an applicable margin of 1.25%. The Base Rate is equal to the highest of the (a) Federal Funds Rate plus 0.50%, (b) the rate of interest in effect for such day as publicly announced from time to time by The Bank of Nova Scotia as its "prime rate", or (c) one month Term SOFR plus a SOFR adjustment of 0.10% plus 1.00%. The facility has a maturity date of October 31, 2026.
Issuance of Long-Term Debt— On July 8, 2025, Bangor issued $14.0 million of Notes due 2030 at 5.70% and $18.0 million of Notes due 2035 at 6.31%. Bangor used the net proceeds to refinance existing debt and for general corporate purposes. Approximately $0.2 million of costs associated with this issuance were recorded as a reduction of Long-Term Debt for presentation purposes on the Consolidated Balance Sheet in the third quarter of 2025.
On August 21, 2024, Unitil Corporation issued $20.0 million of Notes due 2034 at 5.99%. Fitchburg issued $12.5 million of Notes due 2034 at 5.54% and $12.5 million of Notes due 2044 at 5.99%. Unitil Energy issued $40.0 million of Bonds due 2054 at 5.69%. Northern Utilities issued $25.0 million of Notes due 2034 at 5.54% and $15.0 million of Notes due 2039 at 5.74%. Granite State issued $10.0 million of Notes due 2034 at 5.74%. The Company used the net proceeds from these offerings to refinance existing debt and for general corporate purposes. Approximately $1.0 million of costs associated with this issuance were recorded as a reduction of Long-Term Debt for presentation purposes on the Consolidated Balance Sheet in the third quarter of 2024.
Unitil Corporation and its utility subsidiaries, Fitchburg, Unitil Energy, Northern Utilities, and Granite State are currently rated “BBB+” and Bangor is rated “BBB” by Standard & Poor’s Ratings Services. Unitil Corporation and Granite State are currently rated “Baa2”, and Fitchburg, Unitil Energy and Northern Utilities are currently rated “Baa1” by Moody’s Investors Services.
The continued availability of various methods of financing, as well as the choice of a specific form of security for such financing, will depend on many factors, including, but not limited to: security market conditions; general economic climate; regulatory approvals; the ability to meet covenant issuance restrictions; the level of earnings, cash flows and financial position; and the competitive pricing offered by financing sources. The Company believes it has sufficient sources of working capital to fund its operations.
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Contractual Obligations
The Company and its subsidiaries have material obligations for payment of principal and interest on its long-term debt as well as for operating and capital leases that are discussed in Note 4 (Debt and Financing Arrangements).
The Company and its subsidiaries have material energy supply commitments that are discussed in Note 6 (Energy Supply) and Note 8 (Commitments and Contingencies) to the accompanying Consolidated Financial Statements. Cash outlays for the purchase of electricity and natural gas to serve customers are subject to reconciling recovery through periodic changes in rates, with carrying charges on deferred balances. From year to year, there are likely to be timing differences associated with the cash recovery of such costs, creating under- or over-recovery situations at any point in time. Rate recovery mechanisms are typically designed to collect the under-recovered cash or refund the over-collected cash over subsequent periods of less than one year.
The Company provides limited guarantees on certain energy and natural gas asset management contracts entered into by the distribution utilities. The Company’s policy is to limit the duration of these guarantees. As of December 31, 2025, there were $50.3 million of guarantees outstanding.
Northern Utilities and Bangor enter into asset management agreements under which Northern Utilities and Bangor release certain natural gas pipeline and storage assets, resell the natural gas storage inventory to an asset manager and subsequently repurchase the inventory over the course of the natural gas heating season at the same price at which it sold the natural gas inventory to the asset manager. There was $9.3 million of natural gas storage inventory and corresponding obligations at December 31, 2025, related to these asset management agreements. The amount of natural gas inventory released in December 2025, which was payable in January 2026, was $3.0 million and was recorded in Accounts Payable at December 31, 2025.
Benefit Plan Funding
The Company, along with its subsidiaries, made cash contributions to its Pension Plan in the amounts of $3.9 million and $3.8 million in 2025 and 2024, respectively. The Company, along with its subsidiaries, contributed $2.2 million and $2.5 million to Voluntary Employee Benefit Trusts (VEBTs) in 2025 and 2024, respectively. The Company, along with its subsidiaries, expects to continue to make contributions to its Pension Plan and the VEBTs in 2026 and future years at least at minimum required amounts. See Note 10 (Retirement Benefit Plans) to the accompanying Consolidated Financial Statements.
Off-Balance Sheet Arrangements
The Company and its subsidiaries do not currently use, and are not dependent on the use of, off-balance sheet financing arrangements such as securitization of receivables or obtaining access to assets or cash through special purpose entities or variable interest entities. As of December 31, 2025, other than the energy and natural gas asset management contract guarantees noted above, there were no other guarantees outstanding. See Note 4 (Debt and Financing Arrangements) to the accompanying Consolidated Financial Statements.
Cash Flows
Unitil’s utility operations, taken as a whole, are seasonal in nature and subject to seasonal fluctuations in cash flows. The tables below summarize the major sources and uses of cash (in millions) for 2025 and 2024.
Cash Provided by Operating Activities
Cash Provided by Operating Activities - Cash Provided by Operating Activities was $131.3 million in 2025, an increase of $5.4 million compared to 2024.
Cash flow from Net Income, adjusted for the total of non-cash charges was $148.5 million in 2025 compared to $136.4 million in 2024, an increase of $12.1 million. The change to Net Income is primarily attributable to increases in electric and gas sales margin partially offset by higher operating expense. The increase in depreciation and amortization of $12.6 million in
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2025 compared to 2024 reflects higher rates and additional depreciation on higher utility plant in service. The decrease in the deferred tax provision of ($3.6) million in 2025 compared to 2024 is primarily driven by lower tax depreciation in 2025.
Changes in working capital items resulted in a ($20.6) million use of cash in 2025 compared to a ($1.6) million use of cash in 2024, representing a decrease in use of cash of ($19.0) million. The change in working capital in 2025 compared to 2024 is primarily related to the net change in accounts receivable, exchange gas receivable, and regulatory liabilities and is reflective of the effect of the current macroeconomic environment and the timing of cash receipts and disbursements in the normal course of business.
Deferred Regulatory and Other Charges changed by $3.3 million in 2025 compared to 2024, primarily driven by changes in Regulatory Assets and Liabilities, and the change in Other, net in 2025 compared to 2024 was $9.0 million.
Cash Used in Investing Activities
Cash Used in Investing Activities - Cash Used in Investing Activities was ($345.5) million in 2025 compared to ($169.9) million in 2024, an increase of $175.6 million. The higher spending in 2025 is primarily related to $160.4 million for the acquisitions of Bangor Natural Gas and Maine Natural Gas. Normal utility capital expenditures for electric and gas utility system additions increased $15.2 million compared to 2024. The Company’s projected capital spending for 2026 is $221 million.
Cash Provided by Financing Activities
Cash Provided by Financing Activities - Cash Provided by Financing Activities was $223.5 million in 2025 compared to cash provided of $43.8 million in 2024. The higher cash provided from financing activities in 2025 compared to 2024 of $179.7 million is primarily attributable to higher proceeds from short-term debt of $206.1 million and higher proceeds from issuance of common stock of $72.4 million. Offsetting these cash sources was lower proceeds from the issuance of long-term debt of $103.0 million compared to 2024. Other changes in financing activities in 2025 provided higher cash of $4.2 million compared to 2024.
FINANCIAL COVENANTS AND RESTRICTIONS
The agreements under which the Company and its subsidiaries issue long-term debt contain various covenants and restrictions. These agreements do not contain any covenants or restrictions pertaining to the maintenance of financial ratios or the issuance of short-term debt. These agreements do contain covenants relating to, among other things, the issuance of additional long-term debt, cross-default provisions, business combinations and covenants restricting the ability to (i) pay dividends, (ii) incur indebtedness and liens, (iii) merge or consolidate with another entity or (iv) sell, lease or otherwise dispose of all or substantially all assets. See Note 4 (Debt and Financing Arrangements) to the accompanying Consolidated Financial Statements.
Unitil’s Credit Facility contains customary terms and conditions for credit facilities of this type, including affirmative and negative covenants. There are restrictions on, among other things, Unitil’s and its subsidiaries’ ability to permit liens or incur indebtedness, and restrictions on Unitil’s ability to merge or consolidate with another entity or change its line of business. The affirmative and negative covenants under the Credit Facility apply to Unitil until the Credit Facility terminates and all amounts borrowed under the Credit Facility are paid in full (or with respect to letters of credit, they are cash collateralized). The only financial covenant in the Credit Facility provides that Unitil’s Funded Debt to Capitalization (as each term is defined in the Credit Facility) cannot exceed 65%, tested on a quarterly basis. At December 31, 2025 and December 31, 2024, the Company was in compliance with the covenants contained in the Credit Facility in effect on that date.
The Company and its subsidiaries are currently in compliance with all such covenants in these debt instruments.
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DIVIDENDS
Unitil’s annual common dividend was $1.80 per common share in 2025, $1.70 per common share in 2024, and $1.62 per common share in 2023. Unitil’s dividend policy is reviewed periodically by the Board. Unitil has maintained an unbroken record of quarterly dividend payments since trading began in Unitil’s common stock. At a January 2026 meeting of the Board, the Board declared a quarterly dividend on the Company’s common stock of $0.475 per share, an increase of $0.025 per share on a quarterly basis, resulting in an increase in the effective annualized dividend rate to $1.90 from $1.80. The amount and timing of all dividend payments are subject to the discretion of the Board and will depend upon business conditions, results of operations, financial conditions and other factors. In addition, the ability of the Company’s subsidiaries to pay dividends or make distributions to Unitil, and, therefore, Unitil’s ability to pay dividends, depends on, among other things:
the actual and projected earnings and cash flow, capital requirements and general financial condition of the Company’s subsidiaries;
the prior rights of holders of existing and future preferred stock, mortgage bonds, long-term notes and other debt issued by the Company’s subsidiaries;
the restrictions on the payment of dividends contained in the existing loan agreements of the Company’s subsidiaries and that may be contained in future debt agreements of the Company’s subsidiaries, if any; and
limitations that may be imposed by New Hampshire, Massachusetts and Maine state regulatory agencies.
In addition, before the Company can pay dividends on its common stock, it must satisfy its debt obligations and comply with any statutory or contractual limitations. See Financial Covenants and Restrictions in this report, as well as Note 4 (Debt and Financing Arrangements) to the accompanying Consolidated Financial Statements.
LEGAL PROCEEDINGS
The Company is involved in legal and administrative proceedings and claims of various types, including those which arise in the ordinary course of business. The Company believes, based upon information furnished by counsel and others, that the ultimate resolution of these claims will not have a material effect on its financial position, operating results or cash flows. Refer to “Legal Proceedings” in Note 8 (Commitments and Contingencies) of the Consolidated Financial Statements for a discussion of legal proceedings.
REGULATORY MATTERS
See Note 8 (Commitments and Contingencies) to the Consolidated Financial Statements.
CRITICAL ACCOUNTING POLICIES
The preparation of the Company’s Consolidated Financial Statements in conformity with generally accepted accounting principles in the United States of America requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. In making those estimates and assumptions, the Company is sometimes required to make subjective and/or complex judgments about the effect of matters that are inherently uncertain and for which different estimates that could reasonably have been used could have resulted in material differences in its financial statements. If actual results were to differ significantly from those estimates, assumptions and judgment, the financial position of the Company could be materially affected and the results of operations of the Company could be materially different than reported. The following is a summary of the Company’s most critical accounting policies, which are defined as those policies where judgments or uncertainties could materially affect the application of those policies. For a complete discussion of the Company’s significant accounting policies, refer to the financial statements and Note 1 (Summary of Significant Accounting Policies).
Regulatory Accounting— The Company’s principal business is the distribution of electricity and natural gas by the five distribution utilities: Unitil Energy, Fitchburg, Northern Utilities, Bangor and Maine Natural. Unitil Energy and Fitchburg are subject to regulation by the FERC. Fitchburg is also regulated by the MDPU, Unitil Energy is regulated by the NHPUC, Northern Utilities is regulated by the MPUC and NHPUC, and Bangor and Maine Natural are regulated by the MPUC. Granite State, the Company’s natural gas transmission pipeline, is regulated by the FERC. Accordingly, the Company uses the
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Regulated Operations guidance as set forth in the Financial Accounting Standards Board Accounting Standards Codification (FASB Codification). In accordance with the FASB Codification, the Company has recorded Regulatory Assets and Regulatory Liabilities which will be recovered from customers, or applied for customer benefit, in accordance with rate provisions approved by the applicable public utility regulatory commission.
The FASB Codification specifies the economic effects that result from the cause and effect relationship of costs and revenues in the rate-regulated environment and the related accounting for a regulated enterprise. Revenues intended to cover certain costs may be recorded either before or after the costs are incurred. If regulation provides assurance that incurred costs will be recovered in the future, these costs would be recorded as deferred charges or “regulatory assets.” If revenues are recorded for costs that are expected to be incurred in the future, these revenues would be recorded as deferred credits or “regulatory liabilities.”
The Company’s principal regulatory assets and liabilities are included on the Company’s Consolidated Balance Sheet and a summary of the Company’s Regulatory Assets is provided in Note 1 (Summary of Significant Accounting Policies) to the consolidated financial statements. Generally, the Company receives a return on investment on its regulated assets for which a cash outflow has been made. Regulatory commissions can reach different conclusions about the recovery of costs, which can have a material effect on the Company’s consolidated financial statements.
The Company believes it is probable that its regulated distribution and transmission utilities will recover their investments in long-lived assets, including regulatory assets. If the Company, or a portion of its assets or operations, were to cease meeting the criteria for application of these accounting rules, accounting standards for businesses in general would become applicable and immediate recognition of any previously deferred costs, or a portion of deferred costs, would be required in the year in which the criteria are no longer met, if such deferred costs were not recoverable in the portion of the business that continues to meet the criteria for application of the FASB Codification topic on Regulated Operations. If unable to continue to apply the FASB Codification provisions for Regulated Operations, the Company would be required to apply the provisions for the Discontinuation of Rate-Regulated Accounting included in the FASB Codification. In the Company’s opinion, its regulated operations will be subject to the FASB Codification provisions for Regulated Operations for the foreseeable future.
Retirement Benefit Obligations— The Company sponsors the Unitil Corporation Retirement Plan (Pension Plan), which is a defined benefit pension plan. Effective January 1, 2010, the Pension Plan was closed to new non-union employees. For union employees, the Pension Plan was closed on various dates between December 31, 2010 and June 1, 2013, depending on the various Collective Bargaining Agreements of each union. The Company also sponsors two non-qualified retirement plans, the Unitil Corporation Supplemental Executive Retirement Plan (SERP), and the Unitil Corporation Deferred Compensation Plan, covering certain executives of the Company, and an employee 401(k) savings plan. Additionally, the Company sponsors the Unitil Employee Health and Welfare Benefits Plan (PBOP Plan), primarily to provide health care and life insurance benefits to retired employees.
The FASB Codification requires companies to record on their balance sheets as an asset or liability the overfunded or underfunded status of their retirement benefit obligations (RBO) based on the projected benefit obligation. The Company has recognized a corresponding Regulatory Asset, to recognize the future collection of the PBOP Plan and SERP obligations in electric and gas rates. The Company has recognized a corresponding Regulatory Liability, to recognize the future flow back of the Pension Plan obligation in electric and gas rates. The Company’s RBO and reported costs of providing retirement benefits are dependent upon numerous factors resulting from actual plan experience and assumptions of future experience. The Company has made critical estimates related to actuarial assumptions, including assumptions of expected returns on plan assets, future compensation, health care cost trends, and appropriate discount rates. The Company’s RBO is affected by actual employee demographics, the level of contributions made to the plans, earnings on plan assets, and health care cost trends. Changes made to the provisions of these plans may also affect current and future costs. If these assumptions were changed, the resulting change in benefit obligations, fair values of plan assets, funded status and net periodic benefit costs could have a material effect on the Company’s financial statements. The discount rate assumptions used in determining retirement plan costs and retirement plan obligations are based on an assessment of current market conditions using high quality corporate bond interest rate indices and pension yield curves. For the year ended December 31, 2025, a change in the discount rate of 0.25% would have resulted in an increase or decrease of approximately $428,700 in the Net Periodic Benefit Cost for the Pension Plan. Similarly, a change of 0.50% in the expected long-term rate of return on plan assets would have resulted in an increase or decrease of approximately $700,300 in the Net Periodic Benefit Cost for the Pension Plan. (See Note 10 (Retirement Benefit Plans) to the accompanying Consolidated Financial Statements.)
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Refer to “Recently Issued Pronouncements” in Note 1 of the Notes of Consolidated Financial Statements for information regarding recently issued accounting standards.
For additional information regarding the foregoing matters, see Note 1 (Summary of Significant Accounting Policies), Note 6 (Energy Supply), and Note 10 (Retirement Benefit Plans) to the Consolidated Financial Statements.
