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Note 5 - Other Investments

9 Months Ended

Jun. 30, 2024

Notes to Financial Statements

Equity Method Investments and Joint Ventures Disclosure [Text Block]

5.	Other Investments

Midstream owns a less than 1% equity investment in the LLC that owns the MVP, which went into service in June 2024. Midstream is also a less than 1% investor, accounted for under the cost method, in Southgate, which is in the design and permitting phase.

While under construction, AFUDC provided the majority of the income recognized by Midstream. The amount of AFUDC recognized during the current and prior year is included in the equity in earnings of unconsolidated affiliate in the tables below. AFUDC ceased in June 2024 when the pipeline went into service.

The Company participates in the earnings of the MVP proportionate to its level of investment. With the MVP in operation, the Company recognizes its share of earnings from the MVP, favorably adjusted for a basis difference between the Company's proportional share of assets and its carrying value that arose when the Company recorded an other-than-temporary impairment of its investment in 2022. This basis difference will be amortized over the operational life of the MVP. Midstream assesses the value of its investment in the LLC on at least a quarterly basis, and no impairment indicators were identified in fiscal 2023 or fiscal 2024 to date.

Funding for Midstream's investments has been provided through equity contributions from Resources and unsecured promissory notes as detailed in Note 7.

Investment balances of MVP and Southgate, as of June 30, 2024 and September 30, 2023, are reflected in the table below:

Balance Sheet location:		June 30, 2024				September 30, 2023
Other Assets:
MVP		$	20,076,299			$	17,096,476
Southgate			99,360				90,617
Investment in unconsolidated affiliates		$	20,175,659			$	17,187,093

		Three Months Ended June 30,								Nine Months Ended June 30,
Income Statement location:			2024				2023				2024				2023
Equity in earnings of unconsolidated affiliate		$	282,604			$	519,482			$	2,979,823			$	523,581

		June 30, 2024				September 30, 2023
Undistributed earnings, net of income taxes, of MVP in retained earnings, excluding impairment		$	11,896,616			$	9,683,797

The undistributed earnings does not include the impairment of the investment in the LLC.

The change in the investment in unconsolidated affiliates is provided below:

		Nine Months Ended June 30,
		2024				2023
Cash investment		$	8,743			$	2,132,679
Change in accrued capital calls			—				(803,998	)
Equity in earnings of unconsolidated affiliate			2,979,823				523,581
Change in investment in unconsolidated affiliates		$	2,988,566			$	1,852,262

Summary unaudited financial statements of MVP are presented below. Southgate financial statements, which are accounted for under the cost method, are not included.

		Income Statements
		Three Months Ended June 30,								Nine Months Ended June 30,
		2024				2023				2024				2023
Revenue		$	3,723,469			$	—			$	3,723,469			$	—
Operating expenses			(10,822,325	)			—				(10,822,325	)			—
AFUDC			38,815,497				49,744,717				343,916,298				49,744,717
Other income, net			1,899,904				304,093				7,799,966				723,805
Net income		$	33,616,545			$	50,048,810			$	344,617,408			$	50,468,522

		Balance Sheets
		June 30, 2024				September 30, 2023
Assets:
Current assets		$	181,484,706			$	795,787,358
Construction work in progress			—				7,499,128,254
Property, plant and equipment, net			9,416,489,036				—
Other assets			13,944,447				11,639,586
Total assets		$	9,611,918,189			$	8,306,555,198

Liabilities and Equity:
Current liabilities		$	218,689,919			$	236,947,158
Noncurrent liabilities			32,500				—
Capital			9,393,195,770				8,069,608,040
Total liabilities and equity		$	9,611,918,189			$	8,306,555,198