UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023

or

☐  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

Commission file number 001-16189

NiSource Inc.

(Exact name of registrant as specified in its charter)

DE		35-2108964
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
801 East 86th Avenue
Merrillville,	IN	46410
(Address of principal executive offices)		(Zip Code)

(877) 647-5990

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Stock, par value $0.01 per share	NI	NYSE
Depositary Shares, each representing a 1/1,000th ownership interest in a share of 6.50% Series B Fixed-Rate Reset Cumulative Redeemable Perpetual Preferred Stock, par value $0.01 per share, liquidation preference $25,000 per share and a 1/1,000th ownership interest in a share of Series B-1 Preferred Stock, par value $0.01 per share, liquidation preference $0.01 per share	NI PR B	NYSE
Series A Corporate Units	NIMC	NYSE

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes þ    No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files.)

Yes þ    No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer þ     Accelerated filer ¨     Emerging growth company ☐     Non-accelerated filer ¨    Smaller reporting company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐    No ☑

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: Common Stock, $0.01 Par Value: 413,254,798 shares outstanding at July 25, 2023.

NISOURCE INC.

FORM 10-Q QUARTERLY REPORT

FOR THE QUARTER ENDED JUNE 30, 2023

Table of Contents 

			Page
	Defined Terms		3
PART I	FINANCIAL INFORMATION
	Item 1.	Financial Statements - unaudited
		Condensed Statements of Consolidated Income (unaudited)	7
		Condensed Statements of Consolidated Comprehensive Income (unaudited)	8
		Condensed Consolidated Balance Sheets (unaudited)	9
		Condensed Statements of Consolidated Cash Flows (unaudited)	11
		Condensed Statements of Consolidated Equity (unaudited)	12
		Notes to Condensed Consolidated Financial Statements (unaudited)	15
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	36
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	58
	Item 4.	Controls and Procedures	58
PART II	OTHER INFORMATION
	Item 1.	Legal Proceedings	59
	Item 1A.	Risk Factors	59
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	59
	Item 3.	Defaults Upon Senior Securities	59
	Item 4.	Mine Safety Disclosures	59
	Item 5.	Other Information	59
	Item 6.	Exhibits	60
	Signature		61

2

DEFINED TERMS
The following is a list of frequently used abbreviations or acronyms that are found in this report:
NiSource Subsidiaries and Affiliates (not exhaustive)
Columbia of Kentucky	Columbia Gas of Kentucky, Inc.
Columbia of Maryland	Columbia Gas of Maryland, Inc.
Columbia of Massachusetts	Bay State Gas Company
Columbia of Ohio	Columbia Gas of Ohio, Inc.
Columbia of Pennsylvania	Columbia Gas of Pennsylvania, Inc.
Columbia of Virginia	Columbia Gas of Virginia, Inc.
NIPSCO	Northern Indiana Public Service Company LLC
NIPSCO Holdings I	NIPSCO Holdings I LLC
NIPSCO Holdings II	NIPSCO Holdings II LLC
NiSource ("we," "us" or "our")	NiSource Inc.
Rosewater	Rosewater Wind Generation LLC and its wholly owned subsidiary, Rosewater Wind Farm LLC
Indiana Crossroads Wind	Indiana Crossroads Wind Generation LLC and its wholly owned subsidiary, Indiana Crossroads Wind Farm LLC
Indiana Crossroads Solar	Indiana Crossroads Solar Generation LLC and its wholly owned subsidiary, Meadow Lake Solar Park LLC
Dunn's Bridge I	Dunn's Bridge I Solar Generation LLC and its wholly owned subsidiary, Dunn's Bridge Solar Center, LLC
Abbreviations and Other
AFUDC	Allowance for funds used during construction
AOCI	Accumulated Other Comprehensive Income (Loss)
ASC	Accounting Standards Codification
ASU	Accounting Standards Update
ATM	At-the-market
BIP	Blackstone Infrastructure Partners L.P
BTA	Build-transfer agreement
CCRs	Coal Combustion Residuals
CEP	Capital Expenditure Program
CERCLA	Comprehensive Environmental Response Compensation and Liability Act (also known as Superfund)
Corporate Units	Series A Corporate Units
COVID-19 ("the COVID-19 pandemic" or "the pandemic")	Novel Coronavirus 2019 and its variants, including the Delta and Omicron variants, and any other variant that may emerge
DPU	Department of Public Utilities
EGUs	Electric Utility Generating Units
EPA	United States Environmental Protection Agency
EPS	Earnings per share
Equity Units	Series A Equity Units
FAC	Fuel adjustment clause
FASB	Financial Accounting Standards Board
FERC	Federal Energy Regulatory Commission
FMCA	Federally Mandated Cost Adjustment
GAAP	Generally Accepted Accounting Principles

3

DEFINED TERMS
GCA	Gas cost adjustment
GHG	Greenhouse gases
GWh	Gigawatt hours
IRA	Inflation Reduction Act of 2022
IRP	Infrastructure Replacement Program
IURC	Indiana Utility Regulatory Commission
JV	Joint Venture
LIBOR	London InterBank Offered Rate
LIFO	Last In, First Out
LIHEAP	Low Income Heating Energy Assistance Programs
Massachusetts Business	All of the assets sold to, and liabilities assumed by, Eversource pursuant to the Asset Purchase Agreement
MGP	Manufactured Gas Plant
MISO	Midcontinent Independent System Operator
MMDth	Million dekatherms
MW	Megawatts
MWh	Megawatt hours
NYMEX	New York Mercantile Exchange
OPEB	Other Postemployment Benefits
PHMSA	Pipeline and Hazardous Materials Safety Administration
PPA	Power Purchase Agreement
PUCO	Public Utilities Commission of Ohio
RNG	Renewable Natural Gas
ROU	Right of use
SAVE	Steps to Advance Virginia's Energy Plan
Scope 1 GHG Emissions	Direct emissions from sources owned or controlled by us (e.g., emissions from our combustion of fuel, vehicles, and process emissions and fugitive emissions)
Scope 2 GHG Emissions	Indirect emissions from sources owned or controlled by us
SEC	Securities and Exchange Commission
Section 201 Tariffs	Tariffs imposed by Executive Order from the President of the U.S. on certain imported solar cells and modules at a rate of 15%, which were recently extended to 2026
SMRP	Safety Modification and Replacement Program
SMS	Safety Management System
SOFR	Secured Overnight Financing Rate
STRIDE	Strategic Infrastructure Development Enhancement
TCJA	An Act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018 (commonly known as the Tax Cuts and Jobs Act of 2017)
TDSIC	Transmission, Distribution and Storage System Improvement Charge
VIE	Variable Interest Entity

Note regarding forward-looking statements

This Quarterly Report on Form 10-Q contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Forward-looking statements in this Quarterly Report on Form 10-Q include, but are not limited to,

statements regarding the ability to complete the NIPSCO Minority Equity Interest Sale (as defined below) on the anticipated timeline or at all; statements regarding the anticipated benefits of the NIPSCO Minority Equity Interest Sale if completed;

4

statements regarding the projected impact of the NIPSCO Minority Equity Interest Sales on our performance or opportunities; any statements regarding our expectations, beliefs, plans, objectives or prospects or future performance or financial condition as a result of or in connection with the NIPSCO Minority Equity Interest Sale; statements concerning our plans, strategies, objectives, expected performance, expenditures, recovery of expenditures through rates, stated on either a consolidated or segment basis, and any and all underlying assumptions and other statements that are other than statements of historical fact. Investors and prospective investors should understand that many factors govern whether any forward-looking statement contained herein will be or can be realized. Any one of those factors could cause actual results to differ materially from those projected. Expressions of future goals and expectations and similar expressions, including "may," "will," "should," "could," "would," "aims," "seeks," "expects," "plans," "anticipates," "intends," "believes," "estimates," "predicts," "potential," "targets," "forecast," and "continue," reflecting something other than historical fact are intended to identify forward-looking statements. All forward-looking statements are based on assumptions that management believes to be reasonable; however, there can be no assurance that actual results will not differ materially.

Factors that could cause actual results to differ materially from the projections, forecasts, estimates and expectations discussed in this Quarterly Report on Form 10-Q include, but are not limited to, risks and uncertainties relating to the timing and certainty of closing the NIPSCO Minority Equity Interest Sale; the ability to satisfy the conditions to closing the NIPSCO Minority Equity Interest Sale, including the ability to obtain FERC approval necessary to complete the NIPSCO Minority Equity Interest Sale; the ability to achieve the anticipated benefits of the NIPSCO Minority Equity Interest Sale; the effects of transaction costs; the effects of the NIPSCO Minority Equity Interest Sale on industry, market, economic, political or regulatory conditions outside of NiSource’s control; any disruption to NiSource’s business from the NIPSCO Minority Equity Interest Sale, including the diversion of management time on NIPSCO Minority Equity Interest Sale-related issues; our ability to execute our business plan or growth strategy, including utility infrastructure investments; potential incidents and other operating risks associated with our business; our ability to adapt to, and manage costs related to, advances in, or failures of, technology; impacts related to our aging infrastructure; our ability to obtain sufficient insurance coverage and whether such coverage will protect us against significant losses; the success of our electric generation strategy; construction risks and natural gas costs and supply risks; fluctuations in demand from residential and commercial customers; fluctuations in the price of energy commodities and related transportation costs or an inability to obtain an adequate, reliable and cost-effective fuel supply to meet customer demands; the attraction and retention of a qualified, diverse workforce and ability to maintain good labor relations; our ability to manage new initiatives and organizational changes; the actions of activist stockholders; the performance of third-party suppliers and service providers; potential cybersecurity attacks; increased requirements and costs related to cybersecurity; any damage to our reputation; any remaining liabilities or impact related to the sale of the Massachusetts Business; the impacts of natural disasters, potential terrorist attacks or other catastrophic events; the physical impacts of climate change and the transition to a lower carbon future; our ability to manage the financial and operational risks related to achieving our carbon emission reduction goals, including our Net-Zero Goal (as defined below); our debt obligations; any changes to our credit rating or the credit rating of certain of our subsidiaries; any adverse effects related to our equity units; adverse economic and capital market conditions or increases in interest rates; inflation; recessions; economic regulation and the impact of regulatory rate reviews; our ability to obtain expected financial or regulatory outcomes; continuing and potential future impacts from the COVID-19 pandemic; economic conditions in certain industries; the reliability of customers and suppliers to fulfill their payment and contractual obligations; the ability of our subsidiaries to generate cash; pension funding obligations; potential impairments of goodwill; the outcome of legal and regulatory proceedings, investigations, incidents, claims and litigation; potential remaining liabilities related to the Greater Lawrence Incident; compliance with applicable laws, regulations and tariffs; compliance with environmental laws and the costs of associated liabilities; changes in taxation; other matters in the "Risk Factors" section of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 and our Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2023, many of which risks are beyond our control. In addition, the relative contributions to profitability by each business segment, and the assumptions underlying the forward-looking statements relating thereto, may change over time.

All forward-looking statements are expressly qualified in their entirety by the foregoing cautionary statements. We undertake no obligation to, and expressly disclaim any such obligation to, update or revise any forward-looking statements to reflect changed assumptions, the occurrence of anticipated or unanticipated events or changes to the future results over time or otherwise, except as required by law.

5

Index	Page
Condensed Statements of Consolidated Income (unaudited)	7
Condensed Statements of Consolidated Comprehensive Income (unaudited)	8
Condensed Consolidated Balance Sheets (unaudited)	9
Condensed Statements of Consolidated Cash Flows (unaudited)	11
Condensed Statements of Consolidated Equity (unaudited)	12
Notes to Condensed Consolidated Financial Statements (unaudited)	15
1. Basis of Accounting Presentation	15
2. Recent Accounting Pronouncements	15
3. Revenue Recognition	15
4. Earnings Per Share	19
5. Equity	21
6. Gas in Storage	23
7. Regulatory Matters	23
8. Risk Management Activities	23
9. Fair Value	25
10. Goodwill	28
11. Income Taxes	28
12. Pension and Other Postretirement Benefits	28
13. Variable Interest Entities	29
14. Long-Term Debt	30
15. Short-Term Borrowings	30
16. Other Commitments and Contingencies	31
17. Accumulated Other Comprehensive Loss	34
18. Other, Net	35
19. Business Segment Information	35

6

PART I

ITEM 1. FINANCIAL STATEMENTS

NiSource Inc.

Condensed Statements of Consolidated Income (unaudited)

	Three Months Ended June 30,				Six Months Ended June 30,
(in millions, except per share amounts)	2023		2022		2023		2022
Operating Revenues
Customer revenues	$	1,067.2	$	1,156.5	$	2,963.3	$	2,996.8
Other revenues	22.8		26.7		92.7		59.7
Total Operating Revenues	1,090.0		1,183.2		3,056.0		3,056.5
Operating Expenses
Cost of energy	251.9		383.7		1,017.0		1,090.4
Operation and maintenance	369.5		381.9		760.7		776.2
Depreciation and amortization	233.1		208.7		440.0		401.4
Gain on sale of assets, net	(0.3)		—		(0.3)		(105.0)
Other taxes	66.9		65.6		138.7		149.9
Total Operating Expenses	921.1		1,039.9		2,356.1		2,312.9
Operating Income	168.9		143.3		699.9		743.6
Other Income (Deductions)
Interest expense, net	(110.5)		(84.5)		(219.4)		(168.2)
Other, net	2.0		9.0		3.5		19.9
Total Other Deductions, Net	(108.5)		(75.5)		(215.9)		(148.3)
Income before Income Taxes	60.4		67.8		484.0		595.3
Income Taxes	14.1		12.0		99.9		108.2
Net Income	46.3		55.8		384.1		487.1
Net loss attributable to noncontrolling interest	(12.5)		(11.2)		(7.7)		(6.7)
Net Income Attributable to NiSource	58.8		67.0		391.8		493.8
Preferred dividends	(12.7)		(13.8)		(26.5)		(27.6)
Preferred redemption premium	(6.2)		—		(6.2)		—
Net Income Available to Common Shareholders	39.9		53.2		359.1		466.2
Earnings Per Share
Basic Earnings Per Share	$	0.10	$	0.13	$	0.87	$	1.15
Diluted Earnings Per Share	$	0.09	$	0.12	$	0.80	$	1.06
Basic Average Common Shares Outstanding	413.3		406.4		413.1		406.2
Diluted Average Common Shares	446.8		440.2		446.9		440.8

The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

7

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Condensed Statements of Consolidated Comprehensive Income (unaudited)

	Three Months Ended June 30,				Six Months Ended June 30,
(in millions, net of taxes)	2023		2022		2023		2022
Net Income	$	46.3	$	55.8	$	384.1	$	487.1
Other comprehensive income:
Net unrealized gain (loss) on available-for-sale debt securities(1)	(1.2)		(3.9)		0.8		(9.6)
Reclassification adjustment for cash flow hedges(2)	(0.2)		56.0		(0.1)		103.0
Unrecognized pension and OPEB benefit (costs)(3)	0.3		(2.5)		0.6		(2.4)
Total other comprehensive income (loss)	(1.1)		49.6		1.3		91.0
Comprehensive Income	$	45.2	$	105.4	$	385.4	$	578.1

(1)Net unrealized gain (loss) on available-for-sale debt securities, net of $0.3 million tax benefit and $1.1 million tax benefit in the second quarter of 2023 and 2022, respectively, and $0.2 million of tax expense and $2.6 million tax benefit for the six months ended 2023 and 2022, respectively.

(2)Reclassification adjustment for cash flow hedges, net of $0.0 million tax expense and $12.8 million tax expense in the second quarter of 2023 and 2022, respectively , and $0.1 million of tax benefit and $34.1 million tax expense for the six months ended 2023 and 2022, respectively.

(3)Unrecognized pension and OPEB benefit (costs), net of $0.1 million of tax expense and $0.8 million tax benefit in the second quarter of 2023 and 2022, respectively, and $0.2 million of tax expense and $0.8 million tax benefit for the six months ended 2023 and 2022, respectively.

The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

8

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Condensed Consolidated Balance Sheets (unaudited)

(in millions)	June 30, 2023		December 31, 2022
ASSETS
Property, Plant and Equipment
Plant	$	29,135.4	$	27,551.3
Accumulated depreciation and amortization	(7,960.2)		(7,708.7)
Net Property, Plant and Equipment(1)	21,175.2		19,842.6
Investments and Other Assets
Unconsolidated affiliates	3.8		1.6
Available-for-sale debt securities (amortized cost of $168.8 and $166.7, allowance for credit losses of $0.7 and $0.9, respectively)	154.9		151.6
Other investments	78.5		71.0
Total Investments and Other Assets	237.2		224.2
Current Assets
Cash and cash equivalents	151.3		40.8
Restricted cash	39.8		34.6
Accounts receivable	631.4		1,065.8
Allowance for credit losses	(27.8)		(23.9)
Accounts receivable, net	603.6		1,041.9
Gas inventory	214.3		531.7
Materials and supplies, at average cost	180.1		151.4
Electric production fuel, at average cost	68.3		68.8
Exchange gas receivable	43.1		128.1
Regulatory assets	200.3		233.2
Deposits to renewable generation asset developer	137.4		143.8
Prepayments and other	218.7		210.0
Total Current Assets(1)	1,856.9		2,584.3
Other Assets
Regulatory assets	2,300.2		2,347.6
Goodwill	1,485.9		1,485.9
Deferred charges and other	288.3		252.0
Total Other Assets	4,074.4		4,085.5
Total Assets	$	27,343.7	$	26,736.6

(1)Includes $1,349.7 million and $978.5 million at June 30, 2023 and December 31, 2022, respectively, of net property, plant and equipment assets and $160.4 million and $25.7 million at June 30, 2023 and December 31, 2022, respectively, of current assets of consolidated VIEs that may be used only to settle obligations of the consolidated VIEs. Refer to Note 13, "Variable Interest Entities," for additional information.

The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

9

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Condensed Consolidated Balance Sheets (unaudited) (continued)

(in millions, except share amounts)	June 30, 2023		December 31, 2022
CAPITALIZATION AND LIABILITIES
Capitalization
Stockholders’ Equity
Common stock - $0.01 par value, 600,000,000 shares authorized; 413,148,513 and 412,142,602 shares outstanding, respectively	$	4.2	$	4.2
Preferred stock - $0.01 par value, 20,000,000 shares authorized; 902,500 and 1,302,500 shares outstanding, respectively	1,152.6		1,546.5
Treasury stock	(99.9)		(99.9)
Additional paid-in capital	7,383.1		7,375.3
Retained deficit	(1,173.8)		(1,213.6)
Accumulated other comprehensive loss	(35.8)		(37.1)
Total NiSource Stockholders’ Equity	7,230.4		7,575.4
Noncontrolling interest in consolidated subsidiaries	341.0		326.4
Total Equity	7,571.4		7,901.8
Long-term debt, excluding amounts due within one year	11,002.8		9,523.6
Total Capitalization	18,574.2		17,425.4
Current Liabilities
Current portion of long-term debt	29.4		30.0
Short-term borrowings	1,589.9		1,761.9
Accounts payable	718.4		899.5
Dividends payable - common stock	103.4		—
Dividends payable - preferred stock	8.2		—
Customer deposits and credits	207.6		324.7
Taxes accrued	208.7		246.2
Interest accrued	125.0		138.4
Exchange gas payable	33.0		147.6
Regulatory liabilities	362.0		236.8
Asset retirement obligations	50.7		35.5
Accrued compensation and employee benefits	151.7		167.5
Obligations to renewable generation asset developer	—		347.2
Other accruals	503.2		325.2
Total Current Liabilities(1)	4,091.2		4,660.5
Other Liabilities
Deferred income taxes	1,986.0		1,854.5
Accrued liability for postretirement and postemployment benefits	237.0		245.5
Regulatory liabilities	1,679.8		1,775.8
Asset retirement obligations	480.9		478.1
Other noncurrent liabilities and deferred credits	294.6		296.8
Total Other Liabilities(1)	4,678.3		4,650.7
Commitments and Contingencies (Refer to Note 16, "Other Commitments and Contingencies")
Total Capitalization and Liabilities	$	27,343.7	$	26,736.6

(1)Includes $344.5 million and $128.2 million at June 30, 2023 and December 31, 2022, respectively, of current liabilities and $54.4 million and $30.6 million at June 30, 2023 and December 31, 2022, respectively, of other liabilities of consolidated VIEs that creditors do not have recourse to our general credit. Refer to Note 13, "Variable Interest Entities," for additional information.

The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

10

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Condensed Statements of Consolidated Cash Flows (unaudited)

Six Months Ended June 30, (in millions)	2023		2022
Operating Activities
Net Income	$	384.1	$	487.1
Adjustments to Reconcile Net Income to Net Cash from Operating Activities:
Depreciation and amortization	440.0		401.4
Deferred income taxes and investment tax credits	93.0		100.8
Gain on sale of assets	(0.3)		(105.0)
Other adjustments	6.6		14.1
Changes in Assets and Liabilities:
Components of working capital	300.6		2.4
Regulatory assets/liabilities	12.6		(8.2)
Deferred charges and other noncurrent assets	(18.4)		(16.1)
Other noncurrent liabilities and deferred credits	(27.2)		30.7
Net Cash Flows from Operating Activities	1,191.0		907.2
Investing Activities
Capital expenditures	(1,161.9)		(917.0)
Insurance recoveries	—		105.0
Payment to renewable generation asset developer	(137.4)		(79.0)
Other investing activities	(76.3)		(60.1)
Net Cash Flows used for Investing Activities	(1,375.6)		(951.1)
Financing Activities
Proceeds from Issuance of long-term debt	1,488.7		345.6
Repayments of finance lease obligations	(16.1)		(34.7)
Change in short-term borrowings, net (maturity ≤ 90 days)	(172.2)		(5.0)
Issuance of common stock, net of issuance costs	6.3		5.9
Redemption of preferred stock	(393.9)		—
Preferred stock redemption premium	(6.2)		—
Equity costs, grant withholdings and debt related costs	(16.7)		(9.1)
Contributions from noncontrolling interest	35.0		—
Distributions to noncontrolling interest	(10.0)		(3.0)
Dividends paid - common stock	(206.6)		(190.6)
Dividends paid - preferred stock	(27.6)		(27.6)
Contract liability payment	(33.2)		(33.0)
Payment of obligation to renewable generation asset developer	(347.2)		—
Net Cash Flows from Financing Activities	300.3		48.5
Change in cash, cash equivalents and restricted cash	115.7		4.6
Cash, cash equivalents and restricted cash at beginning of period	75.4		94.9
Cash, Cash Equivalents and Restricted Cash at End of Period	$	191.1	$	99.5

Reconciliation to Balance Sheet

Six Months Ended June 30, (in millions)	2023
Cash and cash equivalents	151.3
Restricted Cash	39.8
Total Cash, Cash Equivalents and Restricted Cash	191.1

Supplemental Disclosures of Cash Flow Information

Six Months Ended June 30, (in millions)	2023		2022
Non-cash transactions:
Capital expenditures included in current liabilities	$	410.2	$	252.6
Dividends declared but not paid	111.6		103.6
Purchase contract liability(1)	32.6		97.3

(1) Refer to Note 5, "Equity," for additional information

The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

11

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Condensed Statements of Consolidated Equity (unaudited)

(in millions)	Common Stock		Preferred Stock(1)		Treasury Stock		Additional Paid-In Capital		Retained Deficit		Accumulated Other Comprehensive Loss		Noncontrolling Interest in Consolidated Subsidiaries(2)		Total
Balance as of April 1, 2023	$	4.2	$	1,546.5	$	(99.9)	$	7,372.9	$	(1,114.8)	$	(34.7)	$	329.5	$	8,003.7
Comprehensive Income:
Net income (loss)	—		—		—		—		58.8		—		(12.5)		46.3
Other comprehensive income, net of tax	—		—		—		—		—		(1.1)		—		(1.1)
Dividends:
Common stock ($0.25 per share)	—		—		—		—		(103.4)		—		—		(103.4)
Preferred stock (See Note 5)	—		—		—		—		(8.2)		—		—		(8.2)
Preferred stock redemption	—		(393.9)		—		—		—		—		—		(393.9)
Preferred stock redemption premium	—		—		—		—		(6.2)		—		—		(6.2)
Contributions from noncontrolling interest	—		—		—		—		—		—		28.7		28.7
Distributions to noncontrolling interests	—		—		—		—		—		—		(4.7)		(4.7)
Stock issuances:
Employee stock purchase plan	—		—		—		1.5		—		—		—		1.5
Long-term incentive plan	—		—		—		6.2		—		—		—		6.2
401(k) and profit sharing	—		—		—		2.5		—		—		—		2.5
Balance as of June 30, 2023	$	4.2	$	1,152.6	$	(99.9)	$	7,383.1	$	(1,173.8)	$	(35.8)	$	341.0	$	7,571.4
(1) See Note 5, "Equity," for additional information. (2) Contributions from noncontrolling interest is net of commitment and consulting fees and other legal costs related to the mechanical completion closing of Dunn's Bridge I of $2.7 million
(in millions)	Common Stock		Preferred Stock(1)		Treasury Stock		Additional Paid-In Capital		Retained Deficit		Accumulated Other Comprehensive Loss		Noncontrolling Interest in Consolidated Subsidiaries(2)		Total
Balance as of January 1, 2023	$	4.2	$	1,546.5	$	(99.9)	$	7,375.3	$	(1,213.6)	$	(37.1)	$	326.4	$	7,901.8
Comprehensive Income:
Net income (loss)	—		—		—		—		391.8		—		(7.7)		384.1
Other comprehensive income, net of tax	—		—		—		—		—		1.3		—		1.3
Dividends:
Common stock ($0.75 per share)	—		—		—		—		(310.1)		—		—		(310.1)
Preferred stock (See Note 5)	—		—		—		—		(35.7)		—		—		(35.7)
Preferred stock redemption	—		(393.9)		—		—		—		—		—		(393.9)
Preferred stock redemption premium	—		—		—		—		(6.2)		—		—		(6.2)
Contributions from noncontrolling interest	—		—		—		—		—		—		32.3		32.3
Distributions to noncontrolling interests	—		—		—		—		—		—		(10.0)		(10.0)
Stock issuances:
Employee stock purchase plan	—		—		—		2.8		—		—		—		2.8
Long-term incentive plan	—		—		—		(0.1)		—		—		—		(0.1)
401(k) and profit sharing	—		—		—		5.1		—		—		—		5.1
Balance as of June 30, 2023	$	4.2	$	1,152.6	$	(99.9)	$	7,383.1	$	(1,173.8)	$	(35.8)	$	341.0	$	7,571.4
(1) See Note 5, "Equity," for additional information. (2) Contributions from noncontrolling interest is net of commitment and consulting fees and other legal costs related to the mechanical completion closing of Dunn's Bridge I of $2.7 million

12

ITEM 1. FINANCIAL STATEMENTS (continued)

(in millions)	Common Stock		Preferred Stock(1)		Treasury Stock		Additional Paid-In Capital		Retained Deficit		Accumulated Other Comprehensive Loss		Noncontrolling Interest in Consolidated Subsidiaries		Total
Balance as of April 1, 2022	$	4.1	$	1,546.5	$	(99.9)	$	7,208.9	$	(1,372.3)	$	(85.4)	$	329.5	$	7,531.4
Comprehensive Income:
Net income	—		—		—		—		67.0		—		(11.2)		55.8
Other comprehensive income, net of tax	—		—		—		—		—		49.6		—		49.6
Dividends:
Common stock ($0.24 per share)	—		—		—		—		(95.4)		—		—		(95.4)
Preferred stock (See Note 5)	—		—		—		—		(8.2)		—		—		(8.2)
Distributions to noncontrolling interest	—		—		—		—		—		—		(2.5)		(2.5)
Stock issuances:
Employee stock purchase plan	—		—		—		1.3		—		—		—		1.3
Long-term incentive plan	—		—		—		6.0		—		—		—		6.0
401(k) and profit sharing	—		—		—		2.4		—		—		—		2.4
Balance as of June 30, 2022	$	4.1	$	1,546.5	$	(99.9)	$	7,218.6	$	(1,408.9)	$	(35.8)	$	315.8	$	7,540.4
(1) See Note 5, "Equity," for additional information.
(in millions)	Common Stock		Preferred Stock(1)		Treasury Stock		Additional Paid-In Capital		Retained Deficit		Accumulated Other Comprehensive Loss		Noncontrolling Interest in Consolidated Subsidiaries		Total
Balance as of January 1, 2022	$	4.1	$	1,546.5	$	(99.9)	$	7,204.3	$	(1,580.9)	$	(126.8)	$	325.6	$	7,272.9
Comprehensive Income:
Net income	—		—		—		—		493.8		—		(6.7)		487.1
Other comprehensive income, net of tax	—		—		—		—		—		91.0		—		91.0
Dividends:
Common stock ($0.71 per share)	—		—		—		—		(286.1)		—		—		(286.1)
Preferred stock (See Note 5)	—		—		—		—		(35.7)		—		—		(35.7)
Distributions to noncontrolling interest													(3.1)		(3.1)
Stock issuances:
Employee stock purchase plan	—		—		—		2.5		—		—		—		2.5
Long-term incentive plan	—		—		—		6.9		—		—		—		6.9
401(k) and profit sharing	—		—		—		4.9		—		—		—		4.9
Balance as of June 30, 2022	$	4.1	$	1,546.5	$	(99.9)	$	7,218.6	$	(1,408.9)	$	(35.8)	$	315.8	$	7,540.4
(1) See Note 5, "Equity," for additional information.

13

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Condensed Statements of Consolidated Equity (unaudited) (continued)

	Preferred	Common
Shares (in thousands)	Shares	Shares	Treasury	Outstanding
Balance as of April 1, 2023	1,303	416,946	(3,963)	412,983
Issued:
Employee stock purchase plan	—	53	—	53
Long-term incentive plan	—	26	—	26
401(k) and profit sharing	—	87	—	87
Redeemed:
Preferred Stock	(400)			—
Balance as of June 30, 2023	903	417,112	(3,963)	413,149
	Preferred	Common
Shares (in thousands)	Shares	Shares	Treasury	Outstanding
Balance as of January 1, 2023	1,303	416,106	(3,963)	412,143
Issued:
Employee stock purchase plan	—	101	—	101
Long-term incentive plan	—	721	—	721
401(k) and profit sharing	—	184	—	184
Redeemed:	—	—	—	—
Preferred Stock	(400)	—	—	—
Balance as of June 30, 2023	903	417,112	(3,963)	413,149
	Preferred	Common
Shares (in thousands)	Shares	Shares	Treasury	Outstanding
Balance as of April 1, 2022	1,303	409,697	(3,963)	405,734
Issued:
Employee stock purchase plan	—	39	—	39
Long-term incentive plan	—	28	—	28
401(k) and profit sharing	—	77	—	77
Balance as of June 30, 2022	1,303	409,841	(3,963)	405,878
	Preferred	Common
Shares (in thousands)	Shares	Shares	Treasury	Outstanding
Balance as of January 1, 2022	1,303	409,266	(3,963)	405,303
Issued:
Employee stock purchase plan	—	83	—	83
Long-term incentive plan	—	328	—	328
401(k) and profit sharing	—	164	—	164
Balance as of June 30, 2022	1,303	409,841	(3,963)	405,878

The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

14

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

1.    Basis of Accounting Presentation

Our accompanying Condensed Consolidated Financial Statements (unaudited) reflect all normal recurring adjustments that are necessary, in the opinion of management, to present fairly the results of operations in accordance with GAAP in the United States of America. The accompanying financial statements include the accounts of us, our majority-owned subsidiaries, and VIEs of which we are the primary beneficiary after the elimination of all intercompany accounts and transactions.

The accompanying financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022. Income for interim periods may not be indicative of results for the calendar year due to weather variations and other factors.

The Condensed Consolidated Financial Statements (unaudited) have been prepared pursuant to the rules and regulations of the SEC. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to those rules and regulations, although we believe that the disclosures made in this Quarterly Report on Form 10-Q are adequate to make the information herein not misleading.

2.    Recent Accounting Pronouncements

Recently Adopted Accounting Pronouncements

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting and in January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope. These pronouncements provide temporary optional expedients and exceptions for applying GAAP principles to contract modifications and hedging relationships to ease the financial reporting burdens of the expected market transition from LIBOR and other interbank offered rates to alternative reference rates. These pronouncements were effective upon issuance on March 12, 2020 through December 31, 2022. In December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848, to extend the temporary accounting rules under Topic 848 from December 31, 2022 to December 31, 2024, after which entities will no longer be permitted to apply the relief in Topic 848. During 2022, the company applied a practical expedient under Topic 848 which allowed for the continuation of cash flow hedge accounting for interest rate derivative contracts upon the transition from LIBOR to alternative reference rates. The application of this expedient had no impact on the Condensed Consolidated Financial Statements (unaudited).

3.    Revenue Recognition

Revenue Disaggregation and Reconciliation. We disaggregate revenue from contracts with customers based upon reportable segment, as well as by customer class. The Gas Distribution Operations segment provides natural gas service and transportation for residential, commercial and industrial customers in Ohio, Pennsylvania, Virginia, Kentucky, Maryland, and Indiana. The Electric Operations segment provides electric service in 20 counties in the northern part of Indiana.

The tables below reconcile revenue disaggregation by customer class to segment revenue, as well as to revenues reflected on the Condensed Statements of Consolidated Income (unaudited):

Three Months Ended June 30, 2023 (in millions)	Gas Distribution Operations(2)		Electric Operations(3)		Corporate and Other		Total
Customer Revenues(1)
Residential	$	450.6	$	122.8	$	—	$	573.4
Commercial	152.1		130.1		—		282.2
Industrial	51.1		112.6		—		163.7
Off-system	22.9		—		—		22.9
Miscellaneous	11.7		13.3		—		25.0
Total Customer Revenues	$	688.4	$	378.8	$	—	$	1,067.2
Other Revenues	4.4		18.2		0.2		22.8
Total Operating Revenues	$	692.8	$	397.0	$	0.2	$	1,090.0

(1)Customer revenue amounts exclude intersegment revenues. See Note 19, "Business Segment Information," for discussion of intersegment revenues.

(2)Amounts included in Gas Distributions Operations Other revenues primarily relate to weather normalization adjustment mechanisms.

(3)Amounts included in Electric Operations Other revenues primarily relate to MISO multi-value projects and revenue from non-jurisdictional transmission assets.

15

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

Three Months Ended June 30, 2022 (in millions)	Gas Distribution Operations(2)		Electric Operations(3)		Corporate and Other(4)		Total
Customer Revenues(1)
Residential	$	465.0	$	137.0	$	—	$	602.0
Commercial	160.6		134.7		—		295.3
Industrial	48.1		138.7		—		186.8
Off-system	59.1		—		—		59.1
Miscellaneous	8.6		4.7		—		13.3
Total Customer Revenues	$	741.4	$	415.1	$	—	$	1,156.5
Other Revenues	(0.3)		22.0		5.0		26.7
Total Operating Revenues	$	741.1	$	437.1	$	5.0	$	1,183.2

(1)Customer revenue amounts exclude intersegment revenues. See Note 19, "Business Segment Information," for discussion of intersegment revenues.

(2)Amounts included in Gas Distributions Operations Other revenues primarily relate to weather normalization adjustment mechanisms.

(3)Amounts included in Electric Operations Other revenues primarily relate to MISO multi-value projects and revenue from non-jurisdictional transmission assets.

(4)Amounts associated with Corporate and Other revenues primarily relate to the Transition Services Agreement entered into in connection with the sale of the Massachusetts Business.

16

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

Six months ended June 30, 2023 (in millions)	Gas Distribution Operations(2)		Electric Operations(3)		Corporate and Other		Total
Customer Revenues(1)
Residential	$	1,437.6	$	273.2	$	—	$	1,710.8
Commercial	512.7		281.0		—		793.7
Industrial	123.0		246.8		—		369.8
Off-system	40.1