OGS - Earnings call transcript Q4 2024

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Operator

Good day, and welcome to the ONE Gas Fourth Quarter and Year-End 2024 Earnings Conference Call and Webcast. Today's conference is being recorded.

At this time, I would like to turn the conference over to Erin Dailey. Please go ahead, Ms. Dailey.

Erin Dailey

live morning, fourth you financial After quarter call being Good to joining results. our Adam. will questions. is our replay are discuss and webcast take prepared you, remarks, and later happy for thank us This be we Thank available a to today. your and year-end XXXX

of Reform provisions XXXX forward-looking results statements. projected A of Litigation as the or predictions expectations of include Securities ONE reminder that and those Gas by Securities statements Private covered made be the the XXXX, during statements forward-looking Actual Act the XXXX, Act Securities considered could amended. this safe Act from any are harbor of call differ materially and that might Exchange in and each should

of that differ, actual results discussion to SEC a cause factors filings. to our could refer please For

are Dinan. the Executive and and on Curtis this Officer; call Officer. President Sighinolfi, me Chief Senior Chris Chief Joining McAnnally, President Senior Chief and Vice morning President Operating and Officer; Vice Financial Sid

I'll to Sid. now turn over the And call

Robert McAnnally

as and like chills Erin, acknowledging safe working start morning, ice good heavy everyone. to and warm. degrees XX been to thanking X keep I'd have our snow, our this and morning low coworkers Thanks, as below and who in by wind customers

safety our team our of the well-being have to natural our our objectives: respect. primary the communities. prioritizing and committed field and in remains providing the always, service challenge and As is rising our and to support They gas customers and

execution our us execution, again delivered and once another to report our for to Gas. year levels. at earnings as -- to strong We're planning guidance, in once pleased expected conservatism XXXX thanks we've allowed marked again fiscal projected has perform successful We're that and capital ONE

diluted consecutive dropped the share and faster the our raised faster since year, EPS midpoint guidance, the guidance in we rates our XXth this had ONEOK short-term We've moderation exceeded of midpoint initiatives expected a elevated year-ahead from O&M pace $X.XX of plan $X.XX. of We had for produced of year to than forecast. as we earnings separated interest $X.XX EPS of the XXXX. exceeded company-wide than guidance quarter, every our expense from year met per company our or achieving full midpoint Last

made system. Alongside These cast finished distribution have emissions We strong milestone we've iron XX% bare eliminating in and from financial projects another helped steel XXXX system. safer service program plan our us XXXX, our pipe performance, systems in strides and as made reduce also our completed in modernizing our in reinforcing marked most replacement we leak-prone our the line leak-related XXXX. Kansas. replacement over by significant

meet. XXXX, continues. metro are in growth across across demand There's in a Oklahoma we we natural X Robust for positioned driving and Kansas, Texas, major In demand a states. still territory, meters our our every set across together our service well occurring economic with gas development, XX,XXX increased to for with customer focused region, growth is new need area housing which, new

centers, to of and opportunities power power a supply exploring natural also for addressing the source. needs are reliable industrial We data gas generation seeking providers electric applications

Chris? to the the to and turn Chris over quarter discuss I'll details Now financial it year. for

Christopher Sighinolfi

Sid, Thanks, and everyone. good morning,

last As guidance quarter. EPS results, Sid we full quarter midpoint noted, with year solid the surpassed we fourth higher revised

diluted was $XX $X.XX XXXX. same $XX the million compared the net in per and share, million or period income fourth GAAP quarter for in with $X.XX

income or $X.XX was $XXX net diluted XXXX. compared -- For million year, $X.XX the with per in share, and sorry, $XXX GAAP full million

states. have normal, in on weather the than material mechanisms was XX% our due normalization territory warmer service earnings effective our was the Although to X quarter in approximately weather we fourth not the impact each across of

increase revenues new our strategy. thanks in $XX.X the our quarter to from reflect regulatory Fourth successfully of executing of an teams rates, work million

up by the X.X% highlighted for in expenses were O&M just approximately year the X%, quarter. fourth a year-over-year increase

Our our and investments O&M, growth job we're the modernization teams making strategies. support system have managing and great done a

expense related due million to depreciation our amounts higher plant property, of in level an elevated Excluding KGSS-I, investment. increase and reflecting and was amortization $X.X net equipment year-over-year, to capital

the our benefit in quarter Other last million Comparatively, decreased net XXXX, year, the in plans. unrealized investments $X.X the a decrease investments market million value. $X.X primarily with increase due in of value income with $X.X million nonqualified compared employee same a to of fourth these experienced quarter associated

to was on rates balances. related over higher year-over-year, paper and KGSS-I, commercial the higher issuances quarter primarily Excluding in interest year $XX.X long-term debt higher million the expense amounts reflecting past

benefited We rate by in in fall had instituted Federal as factored last cuts the Reserve not cuts the from we rate XXXX. any

does the to magnitude our As and not additional occur. cuts the any and rate timing of from a the reminder, pace while guidance Federal Reserve, market continues assume debate rate action XXXX additional

would we forecasts rates assume to be pleased year, our even interest further not While happen. decrease this do will this see

shares forward proceeds approximately of million. $XXX of our for stock at-the-market contracts we under our equity net X.XX million common December, In settled program and

in XX, we purposes. planned, also and proceeds to for work we how short-term the XXXX. storage down progress debt, We general shares on to As extend is remaining purchases, and our maturity to amended the agreements pay utilize sale forward gas construction other date fund which December the corporate

pay commercial the As million interest year. the $XX.X a outstanding of CP rate million which of new X.XX%, stemming of settlements, of days XX, $XXX.X additional weighted from December and used our with equity short-term first average investments of in had paper we to down were

Stable metrics downgrade And S&P AX In earlier its A- above outlook. XXXX December, And points going supports Moody's month, affirmed cash affirmed Our remains credit similar both this strong. and outlook. our sheet were financial at rating performance basis its Stable our hundred threshold balance rating respective agencies. several plan and flow forward.

$XXX for $XXX to further with XXXX. quarter new areas system to million the and the attributable fourth the total costs growth. were removal million, $XXX year compared our asset in is bringing and primarily to The extension expenditures service capital projects of million, Our to customer integrity increase for

year-end, the was base we of authorized XXXX be rate for $X.X $X.X As base will approximately estimate billion. billion, average our approximately and rate

Directors dividend prior Board the In per of of Gas January, the declared share, $X.XX of from quarter. a ONE an increase $X.XX

expenditures of share we per guidance, removal $XXX and lastly, reiterate And asset to $XXX of approximately million, our and $X.XX, of million. XXXX including income net earnings financial million $XXX capital costs diluted to $X.XX

I'll turn it Curtis, that, With to over you.

Curtis Dinan

I'll activity. you, and update with everyone. regulatory on begin an Thank good Chris, morning,

years our interim to leverage cost efforts our reminder, a enable past mechanisms we system work to as regulatory As over us and recoup other investments X the increases.

West made North areas Gas filings Program Service Reliability in Central-Gulf the Texas Gas in customers all service Infrastructure for February. and

effective region, increase. an requesting For be $XX.X Both increase. to million $X.X revenue region, June. the we Central-Gulf are a seeking West million And for are the we in North

allow PBR we recovery The Texas full the making The mechanism in us are performance-based rate making required having adjustment to are GRIP O&M are In to both in file investments system. seek file investments without and annually capital recovery case. we filings a of XX. March system our to us Oklahoma, to increases seek allows of our capital the we rate by

installed add rate. customers update on new at Switching to XX,XXX We over continuing commercial to a meters activity. XXXX, healthy an just in

business pipeline a new future continue entered to with meter of and also secure this solid We year sets.

while coming have residential all and on with is continuing to we demand our calls, year, growth to pace As in seeing safety several the that discussed the step growth in occurring states. We in economic the reliability of anticipate past in invest plan of development designed the our similar system. and capital is X a meet

businesses need. experiencing requests natural industrial are for baseload economic power source, the load. data along centers I-XX generation increase that manufacturing applications and a for in We gas for a backup generation natural and we energy a significant addition growth are the opportunities and These have gas are corridor. The from to fits experiencing reliable in need seeking and

the worth million with execution our to investment on over base. We year, operations. capital million $XXX approximately to strong. Moving growing $XXX capital dedicated XXXX projects of finished over customer completed serving

again weather face in our As provided Sid excellent customers our customer extreme the coworkers have once stated, of conditions. service to

Oklahoma In week, ice this territory extreme to blanketing Kansas, our and the and addition cold, record service winter Texas storms brought snowfalls storm this to January.

significant As sincerely commitment despite warm The of no this events. of taken and during with teams continues our safety to of service for and winter morning, to their kept has of these them perform to are disruptions. well our customers ensuring I our care system want thank each safe dedication customers fringed our that temperatures.

supply the over system portfolio, our XX and on Uri, made investments continue reinforcements price allowed impact and diversifying Storm enhanced our fluctuations and to gas since capacity mitigate we've system to storage our The of implementing us Bcf, to reliability make, including have increasing our customers. Winter

we're the support to Austin An ground market storage increased Austin for gas the investments our further example broke making new where supply leverage Project This natural source in a will this contracts project of of bring demand month. we the decades. System is and Reinforcement

at quarter to capacity to guidance peak supply gas system be was winter priced million A to is current a at the XX%. service index new contemplated Waha and in which interconnection available Austin the provide increased will reinforcement for fourth discount our Hub Our Austin project of trades this increase for year. capital the typically our metro. natural The access will expected $XXX during in by of sources approximately XXXX

over now Sid remarks. And to I'll turn for closing it

Robert McAnnally

and our derisking the detailed and X-year of you In the Thank growth outlook, financial XXXX both. we of highlighting our stability our December, financial plan.

to excellent maintaining delivering continue service. safe strategically manage will and while We operations O&M customer

our fosters reliability growth customers mentioned, also the customer and affordability Curtis while maintaining plan financial that the enjoy. ongoing Our

XXXX, demand. that Austin the commitment gas stakeholders. to natural create fortunate highly energy where all begin demonstrates, building as our We're valued operate we to in long-term demand. And a system infrastructure value meet project As for and reinforcement of and renew the is in we're growing the region we providing to our

drives every privileged our our success, of work day. them X,XXX and dedication I'm to The coworkers alongside

us you we're questions. Thank all morning. Operator, this now for ready joining for

Operator

first comes question Instructions] from Jefferies. [Operator Dumoulin-Smith Julien from Our

Jamieson Ward

are It's for Julien. How James you? Ward on

Robert McAnnally

Good morning. Thank hear to this you. Good. from you

Jamieson Ward

Likewise. It's those another Thursdays. of one busy

that also there's had the think companies mix today. get about I in to X

call. So we had wanted a presence your sure make here to we on that

Robert McAnnally

glad We're could join. you

Jamieson Ward

We questions. have some

upside you'd opportunity centers. data obviously around around it's prepared the be the guess because tangentially locate an in functioning in direct potential choosing capacity set building, mentioned area. them that not I the to akin I'm integral it's the to to remarks using but to and You that

we're is a understand to trying rule. What X-year

line to deal X about and years So be when several at lined until to sign by we've they would where transmission the you that, set a data they would were several that's and Are going look is should they to we you're announce been opportunity when to the it's about something to your up plans? finished, looking teams fit management utilities told have center generation when hearing online, how similar et up, fruition come it into if might think Or it, cetera. capital at?

Robert McAnnally

question. for James, the you thank

Curtis data opportunities to and speak just Texas, opportunities. we those want the be Oklahoma are particularly highlight to asking economic to development fortunate well-funded states, Before that specifically that fact I and centers, are in pursue to to robust have

the but pursue. we of one it in broad electric interesting about center just to is That's Curtis? We're a generation. to to range that choose us service opportunities, data why and industrials, So not opportunities the we us territory we only what gives presented mentioned things be that's of selective the our seeing opportunity see. diversity also

Curtis Dinan

than James, we're that in about growth making it described some as are -- already you situation and set we're opportunity the pursuing, we have as the opportunities type are around say system have, in system. to where you around then what what investments and system difference with are the is, are opportunity our a of the I and opportunities what the varies. future we set think or other I well some that of can leverage little that is fits in we the those described. quicker And those bit There the the closer would there timeframe plans

it's serve up opportunity several of to our us, more industrial opportunity data of for that So to of get center, nature. the load objectives, an or not investments just a line single that something a

Operator

from comes from Jeffrey The next Mizuho. question Christopher

Christopher Jeffrey

more and shifting quarter the XQ. weather gotten significantly XXXX. had in warm XQ, in towards Maybe has colder weather some We just first

as of with capital expectations that curious Just potentially storage to originally guide. your the the monetizing or kind of impact your and addressing working commercial the 'XX on commercial maybe balance the paper paper far and as where compares balance lowering kind

Christopher Sighinolfi

Chris. Thanks, Yes.

the in we dynamic fall. in end to that we of that the what discussed XX% the bit contemplated. as not year component had detailed you a the And is quarter remarks, You'll quickly the fourth were at note, as prepared liquidate about, inventories I primary we last elevated we warmer-than-normal dynamic a relative little storage spoke of did had meant weather the

a note we're $XXX million capital $XXX In addition, bit little million. than you'll higher budget at the

investments then picked CP did you to I short-term it, January. used the that early the And settle note, in up hopefully, days on were of

terms we If you we year, storage. far, colder than in was in February, plan. the our now are think points cold in in about of began with storage with cold XXX January, basis very our normal very line been of inventory, it's January about so it this plans in cold But weather, and wide

in. out the cash quarter and should off, here we'll quarter. come first we'll And that built paid as very be see gets strong see in so It that that flow

Jamieson Ward

then solid at came X%, And O&M, X.X%. touching in XQ maybe just for Great. of kind on about pretty

of on 'XX the number updated any you've kind longer-term for X% Just kind plan? curious, versus out thoughts of thrown that

Curtis Dinan

came initiatives goals that several in the Chris, what the just Curtis. past say this had talked is for fourth the better achieved in I of about We we quarter. some some in is the calls. would we And that we've of

ahead a And the were so of bit us and that little helped fourth we quarter. schedule, in

XXXX any our X included of we point, the and numbers. don't in this either At guidance what's a for change those have to of years,

Operator

from comes The Ladenburg. next Fremont from Paul question

Paul Fremont

end Can given year to X. your well? us you've out? a that to you that sort give would high had wanting quarter. expect this of originally of this you've given talked guidance of the fourth good within for be you that the about Does X to know sense the to apply at year as a range you on Congratulations where range Great. end that I

Christopher Sighinolfi

remarks XXXX, least to not Paul, of midpoint performance financial noted would Sid had mentioned is in this as of achieved I at Sid historical No, prepared specificity much think, results terms the would Chris. of of guidance. range. years been in do of XX what company think, our year in XX, That's, you separated have to the his all around the worthwhile. since I ahead we specifically. take note as in we've and the around there be I independent point

over about the to absolute were highlight explicit for the of that end plan the You're we right range calling to X-year the that high plan, pretty over 'XX 'XX period.

Paul Fremont

systems question And the transmission data at opportunities is, development the are Does XXX. prospects I impact you're that for then the me the considered other areas guess, there by in are center being XXX that a all that seeing? a for Texas, versus X in or kV

Curtis Dinan

But generation really transmission not focus not. of for that's projects those does Paul, requests that of run this these built. are to maybe is Curtis. gas inquiries what the independent initial get it And long are baseload getting projects. we're are These The service. term, the and lines initially providing over around and, the

Paul Fremont

question significant which my is decision gas see difference more, your No, opportunities based provide to you new to makes a ERCOT Right. in on transmission May? in generation do

Curtis Dinan

responding we're opportunities you're not to waiting developed areas They're decision upon are in that. where on contingent the it's referencing. The not

Operator

closing for like to [Operator back Instructions] would now ONE the session. Gas This remarks. question-and-answer the hand concludes team to it I

Erin Dailey

seeing Thank many Gas. in York you all forward ONE of March. again New for in We your look interest in to you

call in day. period books for provide date. details until release when on a early close and May. the in Have We'll first we great a quiet later starts the Our we conference at April quarter extends earnings our

Operator

Webcast. Conference Call and Quarter concludes ONE Fourth and This Year-End XXXX Gas Earnings the

You may now disconnect.

ONE Gas (OGS) 20 Feb 252024 Q4 Earnings call transcript