SWX - Earnings call transcript Q1 2021 | Southwest Gas Holdings, Inc.

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Southwest Gas Holdings 2021 First Quarter Earnings Conference Call. [Operator Instructions] I'd like to turn it over to Mr. Ken Kenny, Vice President of Finance and Treasurer.

You may begin the conference, sir.

Ken Kenny

Thank you, John. Holdings, Gas Southwest to Inc.'s. Welcome Earnings XXXX Call. First Quarter Conference

is and and I John stated, the Kenny, name my Finance As am Ken Vice Treasurer. President,

Internet. call live conference being the Our is over broadcast

to those access website For www.swgasholdings.com on link. click conference and who you would at the please visit of webcast, our call the like

Peterson, we Chief Internet, Executive P. John Hester, Officer; and Chief We the be to Mr. which have slides President, follow have accessed Mr. Senior Gregory and Mr. J. Officer; can Financial on our Vice presentation. Today, President

to turn to obligation update like any to over differ may for All on forward-looking With today, no the that Slide the assume L. Gas may discussed Brown, may said, XXXX, press company statements statements. based may and factors remind XX, brief Further, the X time and which of to Senior of Also, SEC forward-looking I'd results year earnings. from Justin you operations Vice language President, certain you share March address or actual to a statements. information Corporation; senior impact of and assumptions, Counsel be General contains management's the to and an lawyers provide of coming overview in of not Southwest come on that our also XXXX. have company's me that ended such our release our a members we should are will made and of refer update will the and that forward-looking to as the for asked other to description earnings that are filings true, John. the statement. statements per this management guidance These some earnings cause factors

John Hester

Thanks, Ken.

the this Turning to for some we earnings had quarter outlined record We from From per of highlights share quarter Slide first of Holdings first a year. perspective, $X.XX. the X.

regulated guidance earnings over experience and quarter consecutive year. increased our our slightly past $X.XX strong in observation we natural to utility for of customers we the continue XX,XXX narrowed range operations, our dividend In to new the XXth gas also first our year, adding $X We growth, results. to

margin derived the And group, operating CPUC. an by utility cost in of extreme revenues associated settlement or utility million February. reached our loan some And gas million case February Texas to impacts approved million. XXX-day Texas increased We Our by we fund had services the to $XX established incremental weather customers $XXX rate with to our was a in which increased from $XX the California infrastructure from our X.X%, freeze. some by support of experience previously

million. We the quarter EBITDA $XX.X to for also doubling saw

with provide number XX Moving for period our for liquidity, for financial ended we planned today's detailed capital March to for update operations, Peterson with our regulated our Greg breakdown a and X, and unregulated rate growth. an base call. the dividend Slide and outline provide results will along on segment expenditures expectations

and our Greg. over beyond. our I'll provide will the customer on sustainability XXXX our expectations continued update I'll Brown and focus and With growing on call an a Justin update, base, to for provide regulatory that, turn

Gregory Peterson

John. Thanks,

Let's begin company X. with operating a summary results on of Slide total

surrender consolidated Temporary $X.XX share prior changes $X.XX in compared XXXX. quarter. For the company-owned of per million $X.X diluted or was $XX.X quarter to million million first in of the first income or of share net $X.XX quarter income $X.XX loss the or the share $XXX XXXX, per million of reflected per versus current quarter COLI share of policies year in for cash $XX.X or insurance or values per life the a

$XXX included was $X.XX million net income year to ended XXXX, in prior net March per $XXX diluted XX, share. million of income per a period the months million income, COLI-related XX-month compared $X.XX per million $XX.X For of loss while per period year $X. $X.X current share period experienced or in or or XX the the or $X.XX XX The share prior COLI share.

increase each natural Net detailed income the Next, compared $XXX.X in gas XXXX, starting quarterly and look of service months, Slide waterfall driven we'll $XX.X completed million natural stand segment comparison territory. of X. million experienced year's first of the of over the this recently a was by on segment, touch million margin XX first into operations rate. time our for $X first operations them in growth past X.X% out last X cases increase strong customer couple with gas million operating $XX state A operating for an Continuing associated growth to with meter quarter of take items contributed of first. a on I'll The we was rate XX,XXX the million $XX.X relief chart, quarter. rate margin in as sets

of mentioned. The I other between is cash COLI income values increased to that of million the quarters changes surrender $XX.X due policies in primarily

QX expense tracker influenced XXX company $X.X the surrender towards XXXX. to reduce weighted XX% reflect year-over-year COLI the million approximately somewhat Arizona COVID-XX depreciation each our rebalanced general in in and general remember, during the At taxes. $X over tax volatility in similar the may million anticipated XX% a for level of is in equities, cash depreciation, quarter to due a and market you increase increase policies quarter, was and equities. includes The values million in in COLI of general the The the which resulting S&P us. million. is amortization later to were $X.X income resetting for XXXX, COLI time, XX% COLI a underlying income. the of that from for After tax values XXXX, underlying recovery the quarterly comparisons In from taxes of designed million current $X.X are XXXX the to and increase the of property the investments quarter loss first As $XX.X decline in the investments

$X current service to system in depreciation customer transaction new to are service of to in $XXX,XXX implementation million expense XXXX incremental quarter system be to later and more as full normal economies X% to maintenance, and about normal the payment amortization by anticipated or year year prior service the million of increase increased an our and increase gas a compared return includes placed are addition million. or the level our debt year operations. new territories expense. expected implementation the $X capital beginning May $X bad the In expense the due in expenditures, of to moratoriums Operations to in of O&M, fee Late lifted in

losses depicts $X.X the first million operations. for segment quarter are Centuri, to the of XXXX quarter versus infrastructure improved in the services X, changes during the utility on of prior Let's which the due of typical Results for quarter Slide business the winter impacts go Centuri's comparative to Due first to first our first weather year. seasonality, quarter.

the reflects this conditions working includes of million increase increase on some and favorable performed the shown Linetec year. due work revenue X%, efficiencies quarter remaining $XX.X from to work, restoration storm the weather favorable by performed. Operating approximately accelerating from ice costs conditions includes incremental or primarily in emergency COVID-XX $X planned areas, with several and following a of slide, to later areas. primarily The revenue prior As or and Texas $XX.X for previously surrounding increase in of million million which services infrastructure current X%, electric improved million increased due storms weather in reduced in associated due to $XX.X the Infrastructure restrictions benefits services year. expenses work the tornadoes

XX, relative depicts on XX-month at X. total look the the during XXXX. business segments slide ended company Slide contributions March results months This our X Let's by XX

period periods. COLI current the as you and a a quarter, the XX periods. $X.X can gas includes shows provided a expectations. increase As quarter $XX.X is million XXXX XX-month prior provided in the the natural reflected $XX.X operations resulting natural COVID utility net of XX% COLI fluctuations with XX-month This between our consistent operations influence million Centuri $XX.X the reflecting year. services values, during impact components group of Slide first Like had in cash million between performance of change gas income, of our in income significant outsized The see, consolidated XX-month while increase loss near-term COLI infrastructure first a that from a of the remainder XX%. surrender rebound million, period

current XX-month services damage the tornado of million ago. and million increase electric electric offsetting grew the or increase the new with during to in a $XX.X profit expanded the higher dig components of in periods. costs the General customers. maintaining solid infrastructure rate components the electric year increased growth. Centuri the expenses million As COVID. which restoration while impacts investments utilized services value based costs or customer Depreciation infrastructure due period million to million XX. infrastructure $XXX associated earlier, Nevada including Infrastructure are amortization The face equipment restoration $XX.X a than expenses lower Revenues million storm A costs changes minimize decrease electric incremental includes the Including contact million similar brand The higher in-person hurricane, customer of training million This expenses, California associated largely existing corresponding XX% travel the COLI $XX in and shows in the in of during $XXX underlying I incremental to Arizona, to with includes the we and tenant rebalanced combined $XX.X margin million policies of O&M X% volatility $X values process in from modified policy. cash million service increase work of and services to work. incremental component $XX surrender including higher the operating to from depreciation, performed gas due income following customers X/X damage prior these of activities Linetec million XX-month $XX.X storm you and infrastructure segment XX-month utility benefits million and with associated $XX $XXX The average our the compared $XX.X $X.X Partially $XX.X period, $X business costs, associated million Slide also utility X% amortization The period of services level and above territories. tracking prevention and $X between the due about utility reflects or Revenues emergency of under with were administrative in to including in reflected revenues. XX%, construction-related plant our XX-month $XXX impact saved service change the slide or taxes million million, general of the with million of year and and by infrastructure work. property Arizona the $X.X are million was net incentive between in growth before services support taxes other costs. on or the mentioned of relief increased of compensation revenues in in related was million, in infrastructure throughout gas improvement periods. period call future infrastructure to to minimize were incremental million mechanisms. $XX

operations ended months months Slide $XX. the Centuri XX, versus a peer toward the core For X million contributed shows March increase XX EBITDA XX-month XX, ended XX increase increase XX XX quarter million million XXXX. and Slide the position XXXX, The results. was in substantial the depicts group for $XX.X the XX%. of while consolidated March XX% Centuri or net quarterly our comparative in Centuri companies. or was income $XX.X of

both distribution metrics. ranked gas for both highest maintaining in competitive is Centuri's past on the with growth advantage. income those construction while electric compound rates Over and Centuri We focus volatility and EBITDA for believe years, lowest the for annual the XX net

of incremental cash briefly short-term to liquidity, and expenditures utility the $XXX million solid on capital the amount in with in on position our of in March plans Slide of and with This million gas of the associated under beginning gas right borrowings spike me available liquidity $XXX pay touch our capacity financing shows we revolving February, our $XX.X in hand issuance had associated the as March for slide Let of facility segment, the of on prices costs XXXX. XX, million XX.

next growth, approximately $X.X the investment funding safety gas detailed and new Slide and network. and We flows debt. our and We our capital a remaining finding over investments plan service state with years the the to reinforce reliability across even for serve internal to balance XX% X about of pretty billion anticipate of of distribution those plans invest XX. equity are territory X funding Our mix with cash on

about anticipate in $XXX Slide dividend on flow about million million our billion. shown and our add issuances capital will plan $X.X utility be $X.X in cash when operations, $XXX upstream needs issuances. billion debt utility expectations, XX, We we As from source you approximately payout in approximately up to with in X-year equity

historic utilize Southwest new part that indicated years. of return our plan year continued million of $XXX we we shows X to expected the Holdings growth program capital about illustrates per XX dividend graphic million our we believe of XX The of X a the ATM recent Slide which As to the Gas compared an important on SWX, the at next expenditures. to the in investment XX-Q, to over our offer total shareholder investors. has is $XXX Slide

We have dividend the past payout target about increased XX%. to for the year ratio and XX each of years a XX%

over end X.X%. year to Turning a Justin of systems on investment XXXX, is update $X.X the grow in compound of turn to an regulatory rate to X-year the rate now Slide growth call of this billion continued distribution $X.X the beginning matters. our for from annual The I'll our gas XX. expected at at base Brown natural billion to

Justin Brown

Greg. Thanks,

During proposed California approximately year-over-year settlement regulatory increased each rate see this $XX of general final our million refresh the in first to case. quarter, approval, our our jurisdictions. revenues state approval rates With we across of we'll due received of

the on company rates provides settlement was XX%. case annually attrition became of revenue The in of an to XX%, revenues approved beginning the in rate approximately was The rate by final the March. equity our million the Slide an track layer until which X-year us account a filings, the January previously effective. memorandum annual of allows allow to continue decision our April impact authorized margin Rates and became XX, increase of approval $X.X a adjust change next X but will shown decision ROE As to to X California relative X.XX% general on the company effective cycle. over in

been adjust of such, our case that us to As to informed $XXX Two components programs, over those and through to risk annually have million to continued year January X. will decision-making customers, to we'll surcharge. ensure the and other allowed California tracked of important reflect years, make recover the we filing plan since a this costs rates safe allow which X next invest proposed include later a approval very be to to our service up rate to also these reliable amounts

of This to base our surcharge. In $XX.X future this addition, estimated to in and project and recovered the project, which as half about we million the part now annually as Tahoe as rate original be efficiency we move large rates North will from project million filing, $XX the case. are agreed proposed for million of replacement $X through or This period project Lake a original in surcharge originally remove -- it segments included accounted amount from base a of was in completed. the a a

was This revenues $XX in in Nevada approved general became rate case Rates resulting X, rates Turning our in case rate that million to in Arizona XX. $XX January with year became company's increase October general the XXXX. that of XXXX. for Slide allowing increased from effective effective approximate to last million increase approximately of addition is the

we Moving rate for in pending unrecovered filing future surcharges to Slide outcome from made general In XX. a programs. case. plan and in reconciling Arizona previously In XXXX, commission the VSP revenues February, filings suspended surcharge our identifying the COYL the froze approved the and existing compliance our

to including in to to see date. adjust this differences rate later our the year recover VSP the now requesting We'd commission between rates the make be the of up the to In the need amounts, recovered. base VSP end that to time are plan this year. these the case. through received outstanding the As surcharge to period the month XXXX reconcile in which such, And was and revenue adds about time most before we've included plus to we We total, a million. recent evaluate will calendar surcharges the at proposal, not decision to following a plan address filing the $XX costs expect COYL amount which

under where the up service. million the make phase customers In while $XX progress first XX, make city. customers, Turning build-out to out continues to and phase the as also project Creek continue on infrastructure update with we Nevada. a within project of in progress Spring saw projects Northern contracts we of Southern homebuilders Mesquite build we our $XX current expansion continue project with Nevada, request securing the on service gas commercial expansion-related hook In to in Nevada, eligible Slide the natural will begin the way that continue to second XXX% the gas we both in XXXX, our expansion quick we from million to in for are customers as of

Slide Lastly, to XX. turning

customers I'll who the Gas approval, member in the with the anticipate voted turn We seeking Graham to We Arizona. Southwest receiving of cooperative already assets the the the favor that in the are to will Southeast have gas Graham County located year-end. Arizona of approval contemplates County Corporation new million it a in a rate back of base of involve County sale of in expansion which proposed approximately authority acquisition utility, member-owned Subsequent close acquisition application and the of The Arizona $X.X opportunity in the a And filed recovery acquisition. Utilities, gas Gas. acquisition April has be of of acquisition final case. X,XXX general the Graham an a before for approximately John. comprised assets Southwest to they've Utilities and members of company's also Commission rate with approximate $X joint $X.X next will and million, million that, to transaction,

John Hester

Justin. Thanks,

Turning XX. to Slide

COVID-related as to our find growth territories and at we customers year, stronger to I XX,XXX only restrictions over in local Slide grow. relocate strong than service month the to call, year economies that of outset were before. mentioned our the the continue continue people places desirable from rebound and and year-on-year trailing customer commerce over experience shows not XX-month As gains businesses added but the XX to each past we the

XX, additional to customer Natural Power business a base. our energy recent also customers, we of service their awards attributable our our service for diversified consider be Moving won customer in XX. Slide is employees our in nature show customers our demand service strong preferred of residential satisfaction to On XX% territories of and some J.D. for customers. Gas natural West the gas and provider. both excellent Part continued XX% rating to the the earned provide the Best the Slide in We've our service detail on categories. We

Our customers and constructive efficiency mostly X our are only decoupled also different provide for rate to commercial and residential across each not encouragement spread bills energy customers. designs of which are keep but that revenue our stability, states, has of low support

growth, recent XX, new national exceed significantly the home X and where reside, customers to to references of Turning provide Slide we strongly Arizona some all sales averages. momentum Arizona in population economic rebounding media our economy, half million

Slide Northern greenhouse communities new cost reduce usage to carbon a allow Arizona, new service growth, continued to pivot will only these economic will and new and reach Southern due show in Moving Spring to territories is at energy for energy customers development-oriented Nevada, XX, embrace as in our our also we $XXX Slide natural primary they proportioned reminder migration business. million community's referenced, Slide Nevada, them accelerated we've savings territory in new to gas but is that expansions gas demand allowing our where reach that to away footprint us and Southwest brisk opportunities. in move as their and our more state's carbon-intense to exciting convenience Service is expand economy, Justin not XX. see continue climate population Pursuant XX customers. a sales to our reduction and and both of Nevada. rebounding supply natural up from to capital provide paces gas Creek sustainability On economic Similar of lifestyle. legislation new focus high continued efforts service Gas to desert we desirable and towards as home alternative and we in towards living very business-friendly Mesquite

and responsive are to Slide and pursue each greenhouse in and regulatory with to compressed gas, and aligned to our We're climate to both natural legislative outlined finding support more. favorable We related initiatives our regulatory efforts interest Turning variety reduce the in very a legislative of renewable have undertaken hydrogen of XX. that states continue to of change. natural we gas pursuit to efforts venues emissions be gas,

we're renewable policy to XX. throughout technologies to into other real service Moving our projects natural Slide service and gas, support that is territories The our seeing translating gas, interest and commercial compressed natural related hydrogen arrears. in

to system partnering Slide minimized. operators continue the concern energy is and XX, friendly landfills expect we to with important Gas coming environmentally from our an grow efforts dairy methane farms, years. treatment Southwest are significantly greenhouse to provide transportation reference our wastewater options that ensure emissions, plants, On we gas distribution fleet to in

Southwest one systems distribution Gas operates of in the modern most nation. the gas

of even and Our pipe adopt initiatives miles of that emissions, us methane vintages and allowed dramatically. reduce to practices significantly operational grown service number of has methane reduce the replace pipe while older have escaping

Turning to XX. Slide

more bottom please on initiatives noted our the near sustainability sustainable the pursuing report, at we the can latest of a slide. see serve, many our which be for communities accessed future the For website

summarize XX. We proposition for business of believe key we components that our our value Slide Moving an to the excellent investors. create

anticipate gas growth. growth, customer natural operations, we investment base strong in and rate CapEx our resulting For continued

to competitive to other continue energy will prioritize as controls and cost providers. We compared for low advantage us a bills

the per Canadian item are X% guidance, operations, our compared supporting total to line total to natural Net increase year. estimated last X% At to X%, operations. X% both regulated their We the And at of our margin of towards earnings holdings. to rise about cost share expand utility range by outset customers, to opportunities relationships income We will bottom collaborative range. moving capital our by infrastructure slightly eye Canadian business $X we'll with growth electric of in gas first we growing revenues X.X% dividends million. cash source million for Interest I is should can operating modifying infrastructure we our margin to sustainable this pension Operating results costs the our guidance previously $X.XX XXXX an and noncontrolling of In On recognition gas continue a off exchange income operating regulators $X to operational a influence past a excellence, with are X%, services be of quarter by normalized $X.XX, and due expectations to to provided are and segment, the our And range. grow $X $X we our at expect over utility pursuing On $X.XX our manage assume be dividends. million our replace to efforts expenditures range fluctuations with rise for revenues. flat pursue rates in indicated trimming our net expected million. to to in profitability and the earnings customers. of our Centuri company-owned continue Slide seek to X.X% and segment, XX, earnings our life We'll performance, returns of to previously expect insurance year. provide $XXX XX, and million at to of expense for and future provide our interest. $X of X% call, recall energy $X.XX, should constructive to results Slide continued record guidance and our that year provided Infrastructure to as the

our At Southwest we Moving totaling XX% base a ended operations, growth we ending to targeted X.XX% Gas X% of rate revenues At at Holdings the same million is average our network of our dividend grow X level, equity share $X.X expected XX% X X grow over to issuances per X.X% and expectations. expect And ended an expected invest years payout that we over annually to million modernize XXXX. should and the gas Centuri operations, longer-term compounded XX, XX%. a the billion our at be period. of ratio EBITDA utility XX% some XXXX, income years same $XXX distribution revenues. to to with to Operating years expect regulated to to year $XXX X.XX% XXXX the anticipate of over over Slide to and X% rate to period, approximate over annual grow we of to that

Slide Finally, business Southwest segments, significant ahead, turning infrastructure both Holdings Holdings the XXXX with our compelling poised operations which services income for XX% investment. and We ended XX. years offer growth a offers contributing for Gas period segment growth-oriented in XX%. believe net are our X complementary We expected contribute the investors regulated to X-year of our to

growth that, to are with utility the I'll to cash needs to providing expected services Ken. serving call the operations Gas opportunities, With CapEx Centuri segment, growth continue complementary and energy electric increasing dividends base and flows providing for customers, regulated Southwest North gas rate Our of return great Infrastructure affordable our And Services growing experiencing in Holdings. and distribution sustainable companies reliable, across and America our while while providing safe, customers.

Ken Kenny

John. concludes prepared Thanks, That our presentation.

that have These have slides include business slides, also an about your be For slides at pertinent our Holdings its segments. information reviewed convenience. Southwest Gas provided those we accessed who appendix X with can and other

now Our for explain John, the will process operator, questions. asking

Operator

coming the line [Operator from The Sunderland question first of Instructions] Richard from is JPMorgan.

Richard Sunderland

on Centuri. Maybe starting

Just on leading curious results additional Centuri's this to electric and potentially you Do the see growth on contributions sustainable quarter. side? these

John Hester

is this John. Richard,

continued on customers. expand to that doing that see current our definitely think the Centuri side. we're opportunities to that there we work expect with the think are We at growth I electric

cross-sell looking We services. to opportunities also at are

high-quality them make the have can we words, we we're going electric currently look long-standing a that offer other in utility with we're would future, safety. if if for, manner that that sector know M&A a further with there sure relationship course, doing opportunistic that in lot the as we that the is possibly something towards and certainly expanding So of in they we that the are same And options level combination well. work to of electric any services of know bolt-on gas then,

Richard Sunderland

for electric expectations oppositions COYL to recovery it. recently? fits larger the of these than maybe design then types within state? the there. the the And filing. on maybe Got VSP the other curious color state post Or the the now? turning in the your of presser upcoming are Just it right rider there's how and following Appreciate process mechanisms What discussion

Justin Brown

Yes, Richard, it's Justin.

is this little discussions. those than think some different a I bit of

those think evaluating things. more kind they're previously recent more approved. UPS's the I these of are some as rate were ones prospective and mean nature were in I case of

talked which suspended, were we've were case into that fact $XX approved. and surcharges part think million as the these was we when the also when amendment, ultimately I frozen before our the of actually XXXX originally was that request, the about -- rate moved

we think when I that anticipate is our follow track through, of And it this record, they'll go I that similar so kind mean, that, we is from that something our to a And path should, look evaluate I think at our that perspective, from it. perspective, we'll expectations.

Richard Sunderland

it. Got

around, on do up the in of see cropping here. cadence Or debate maybe terms So You Do issues process the here? or guess, the more the recovery? I other see centering you guardrails the timing of

John Hester

be of with the a year. consistent more your some of XX X-year million actual that's timing in a look the cadence I to mentioned, case our rather that so about rate that fairer that example, like I expect I the way to I had merits. than at period, included mean, it. going we of a discussion kind I Yes. over the think $X is comment on know, and would as it

good we But think which to went surcharge combined we issues at in for we up. with the case, not the and be someone on occur. look was continued zero these about perspective, that imagine the on argument that the VSP. the comes, the is plant mechanisms. of crop of the hard in going now those it's addressing. kind the we'll to the a moving the will I our amount our rate regulatory that an There They invested, record, that we case performance was makes from frame adherence today, through have there's the proceedings, think And something They 'XX as to you performance figuring decided COYL that program. process. terms But mechanisms, there pretty findings continue it's here kind mechanisms. previously rate to I trueing other that case it But what a that approved, was experience stand plan up to when with saw of that just and time absolutely

Operator

[Operator coming from Instructions] is of the Clark line Next from America. Bank Kody of question

Kody Clark

the recovering I'm get wondering on just inflation just So how gas talked trying thinking purchase to the while considerations recovery that you costs, also riders on about you're about? rate

Justin Brown

sensitivity. we the price one as recently was and result a we John things again. of going it's looked we during as the a to that experience be make to incremental going those not going needed on going of making we're exceed at ago. I first affordable as our just on few gas to amounts be spike what the years were we of recovered years, is are time to are to filing been evaluated X the kind customers whether analysis of what have impact looking Justin And this did kind first as that focus to Kody, the in any call, extend bills have because When Based period was experienced and a competitive. experiencing anticipated to of bag, costs big that where those which the and mentioned sure our X last mean,

gas something tracker some place, as don't look There and to of think based that accusations mean the any is And we by it's look They on today, the respect to that the kind anticipate I you recovery recover periods -- at costs the process. I those the allow surcharge some things where designed. which findings whatsoever. in the anticipate it went we stands dollars, So to mechanisms will tracker. some wanted a no over at filings. closer had take of are time surcharges. when that that wrong currently with hand-in-hand goes We doing intervenors cost commission were in the the with our any mechanisms through made annual of issues this had the

these with bill to. And not to cadence time on to something to so because from we're recover that's a our again, period there's kind that, perspective, make of any of sure work customers impact we'll them what sensitive unconscionable

Kody Clark

That's mean, when there initial we And time? details any I Okay. Got around is thoughts on on some helpful. that? it. get more might super

Justin Brown

filing? surcharge the On

Kody Clark

Exactly. Right. Yes.

Justin Brown

make to going month. that We're Yes. filing this

the the you that's end our before of see should So part of something be as able month. filing to

Kody Clark

Got you.

just this kind bit thinking And these of on of little provide in can, about jurisdictions more your projects. on country some Okay. Can how the I the operate a constructive then for if color longer-term quickly. of terms RNG, you're you in more opportunity in growth? You

some be upside. seems So like there it could

John Hester

Yes, John. with Kody, is agree I you. this

there for think upside that. I is

new I think exciting it's opportunity. an

interest kind started as We're and already, legislatures a We've it's customers product. our for earlier, in also working most of seeing the projects. kind with all higher have And We I of part, a regulators. by our this been our mentioned lot of good.

example, their municipal possibility more And considering buses was they fleet more here buses, carbon expensive electric Nevada, operator compressed bus footprint Southern are were on inferior. even they to previously so, natural in reduce significantly operating For their of gas. the but the they operationally wanted and

get with So compress will transition to RNG able greenhouse gases. them essentially gas reducing RNG their to of be let conventional that we that's for in gas natural to compressed interest address natural supply work and that's them from a them

on the ahead, So on a see that it. you're road about to we're I of opportunities excited lot going and think --

Operator

from Williams. Siebert the The of from next question is Chris line coming Ellinghaus

Chris Ellinghaus

Centuri level that, The maybe $X.XX of guidance might end of first quarter? unusual work the call in -- the the increase you in the bottom the that's we can range, what infer restoration

Gregory Peterson

that in as I they QX. something this Greg. don't I they Chris, in storm do that is that QX, to more with know the this solid performance had level classify did would work of

weather kind first slows for aware, quarter work. always time down That's you're the of that work winter is the the quarter they Centuri. that a worst in gas As

very were rest it And that a doing the work the the with of took bit level we of to of out that. quarter. so pleased done of little uncertainty by in the get the And year they able first were

bottom basis was the up guidance of for and raising part the that that the So impetus $X.XX.

Chris Ellinghaus

Does that the sort rest of the accelerated work level year? give them for greater opportunities of

Gregory Peterson

Yes. is again. This Greg

good had opportunities. they've always think I really

work the to customers. later open doing some the but planned some weather they As I year, little that work they get they that QX mentioned and in there had some in was a in do because their was are did well my remarks, certainly with favorable of

is As we're them safer to and reliable. infrastructure assets, the looking harden to aware, both U.S. throughout the all electric on the right, their area and side, make more gas

future them. lies indication maybe very So small think a the bright for Centuri, what just ahead QX I of for is is and

Chris Ellinghaus

strong time? getting had give side. how some from much the the of much revenues us had and cross-selling the winter opposed traction opportunity you're pretty in electric some you've is you that Obviously, you restoration color about at restoration Can how the some the that Centuri just of hurricane to as

John Hester

Chris, John. this is

both. really, think it's I

think of electric are Linetec lot continue to think that there that. a grow. great space opportunities the more I the that classify able we of that we to non-union acquisition, and as opportunities to to electric I as And would services their Linetec really made what we provide we well. When able we we're added a the want to provider, that's we business, direction and the when part grow were add electric strategically, as provided think It platform. unionized in

them. want that But are pointed you from from to as electric customers mother continue events that, that help the are sector. going going percentage only, our to regulated sure expand we opportunities not revenues the to to we that there imposes on to also are want to there rebound the make business electric out, see we're generates So to of if nature utility

Chris Ellinghaus

Okay.

Justin mentioned issues. Vegas on pretty think been interest RNG about side. this in the have good The sustainability aggressive on I casinos

from I the assume effort? You are interest customers. the aligned coming well your that talked about to casinos [indiscernible] pretty

John Hester

that. John They're again. is This Chris. Absolutely, very interested in

with there recently convert over their properties to opportunity an one supply was to entirely were we see larger the hydrogen. of fact, working In to if

that's That visit because, as vis-à-vis from territory. service a option to property customers properties that So look Chris, amount of lot regular spending a another differentiator in to of encourage properties. time a our towards other know, you those is their

think think with are lot be very sensitive do that the reduce So with that to I'm way opportunities but other a for be of looking definitely footprint, will of in one there cost. carbon will it. a that resorts, you I RNG seamless And there opportunities low their opportunities ways I is they also sure a name fairly that fairly about could can at businesses the

future, customers we sustainable think because to frankly, our going to because to helps only but demanding continue So want project that pursue it. it we're not those the us for are opportunities, a image

Chris Ellinghaus

Okay.

in seeing are acquisition guys other Lastly, you opportunities Arizona, co-op out the there? small

John Hester

Chris, this is again. John

opportunities. that think there be other I could

appreciate, anything requirements talked right distribution else have system board sure now. have et upgrading parties. of We on with don't number a other will I'm the a the of natural cetera. with as you running We network, distribution operational your safety, gas But with

us. looking that think I are responsibility there are whether party that a over they turn to other that assume like is folks that another at just would

a those from that to and small palatable in you us, if move big because family as I it infrastructure, operator potential those in to to that and And supportive up, the communities. makes on come that the lot very a So aging of opportunities certainly, going relatively like can them. a relatively get impacts more And see we're we regulation we'll of think that. interested safety-oriented capitalize be regulators want from operator are, frankly, rate

Operator

be We it don't presenters. at to have turning back any questions the I'll this time.

Ken Kenny

that operator, work presentation. Thank and appreciate Southwest the Well, you, in have the you. great Gas and our concludes Holdings, for Inc. Thank your doing interest participation prepared a we John, Everyone, as weekend.

Operator

you concludes This call. for all conference today's Thank participating.

may You disconnect. now

Southwest Gas (SWX) 10 May 212021 Q1 Earnings call transcript