ATO - Earnings call transcript Q4 2021 | Atmos Energy Corporation

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Operator

Greetings, and welcome to the Atmos Energy Fourth Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Dan Meziere, Vice President of Investor Relations and Treasurer. sir. you, Thank ahead. Please go

Dan Meziere

President Diana. joining Good President thank you, Senior everyone, Chief Officer. morning, With me for Vice Forsythe, us. Chris Akers, Officer; you Chief today Financial Executive Thank and and and are and Kevin

call and financial available reference also are presentation, which atmosenergy.com includes Today's measures. presentation under the references Our in conference we prepared non-GAAP our earnings slide release tab. to remarks, at will Investor Relations

for presentation information You closest the to slides of should measures and the in non-GAAP today's refer reconciliations contained GAAP information accompanying financial definitional to the measure.

results As Act. we contain review discuss the Securities please these some of discussions meaning financial keep that in might of Act the our and mind and Exchange expectations, Securities within statements forward-looking future the

differ Slide Kevin. over XX filings. more our statements actual cause I turn projections from will could that in call forward-looking results. and on material to factors and differences outlined now SEC such could materially fully described are The Our the

Kevin Akers

morning, our some projects, a key will our begin in provide 'XX we'll you around $X.XX, share year thoughts served part million financial say 'XX. with per who Thank this you additional of later those that Thank review freely. may service. XXX some teammates of On so pipeline bravely we Atmos we close serve moment an consecutive which fiscal fiscal own provide of could morning. update you, this just Dan, who and of Americans to our about would join us Energy take call. Chris today's have glad live everyone. call to Nearly We forces. of the your XXth thank more XX Atmos accomplishments, and I like share are color our than will our with are country, Energy results a your Day, growth. on and Yesterday, the earnings you reported I in for Veterans represents per this to earnings interest appreciate good

of extremely the ongoing of Atmos Our success said all Energy sustained in it their fiscal our success X,XXX commitment provide employees proud 'XX, of once it foundation Company. and and Atmos again, our X.X I'll customers, they I've heart I'm again, the at before and say to the effort of for commitment the are soul reflects long-term healthy X,XXX families and themselves our safe. and keep and million their communities, Energy.

gas period, say, And executing invested we us XX-year heard you've fiscal while investment XXth operating nearly proven XXX,XXX strategy approximately XX-year $XX X,XXX natural added modernize in As same our our lines, distribution, our distribution pipeline. natural of and reliably and pipeline, was period, X,XXX our transmission, storage year And steel transmission customers. over replacing and systems, that safely modernizing and gas XXX,XXX service we of of expanding systems. that miles miles 'XX over nearly billion we

Uri. natural gas our said I As our meet human storm during customers demand quarter our resiliency during needs and of to call, necessary those systems provided gas the investments the winter earnings reliability second

enhance 'XX miles further XX,XXX than of of capital transmission service investment and over all distribution and billion replacement and steel our of safety supported systems lines fiscal system replacement transmission more of Our miles $X over modernization the pipe, further XXX to pipeline, XXX distribution of reliability. the of

XX% meter for resources reported million ensure are by thank investments wireless opportunity as our have and highlight for nearly well their capital reading to on outstanding 'XX, I methane and wireless and for projects. to XXXX reduction. this emissions distribution, necessary towards to Through want we continued make dedication, available as materials us XXX,XXX system. their our efforts have achieved also our an X.X approximately installed transmission, team The and approximate and EPA progress storage fiscal devices reducing devices procurement XX% maintenance of we services. the distribution Additionally, above-mentioned now end take focus the helped

have decade, as did in positioned us 'XX. well our Just strategic efforts the upon strategy for planning they continued execution throughout fiscal past their

inventory year's For pipe coordinated the we've ready throughout with have to at pipe available for well and example, pandemic, the site as increased as our levels upcoming our and mills steel vendors requirements job fiscal projects.

reliability, BCF and additional Pipeline want storage update that storage at projects which supply diversification integrity to we an third replacement XX-inch project XX 'XX, our with project sometime project, of additional APT X Project the cavern Line anticipate part an Atmos miles value APT provide XX also of which cavern late miles BCF development late in XX-inch our XX% you capacity. We're to larger highlight pipeline pipeline, its and Texas placed This Now to will be X nearing X will those dome provide salt we've completion in on complete in as bring of 'XX. X, of an of safety, X few begun being a Phase versatility, of Phase their includes and of completed service customers. already nearly I and We're in Bethel. and

the a move As the is Katy. from transportation Waha companies as APT gas well distribution Waha that from system, of to the plays of project. is from reminder, Metroplex. customers SX to of east Dallas the phases and X Xst Valley key three to Haynesville Line completion providing to the local to nearing shale reliable growing as runs DFW our Line and behind brings service side Also, SX Cotton Line phase supply

We in pipeline by now Phase in forecasted is final X Permian supply diversity be year-end, growing calendar is expected increased supply and metroplex. with support plays project to miles completion to underway provide this end from this XX service line which of from X APT with the Waha December service will in additional late Line currently XX-inch project pipeline, is with this SX, system in XX-inch, the Highway be of and 'XX. by the southern of of 'XX, XX-mile that of of north is approximately Again, and This XX-inch runs completed XX late to Texas, total be anticipate we expected miles Phase the County, Our on replaces XX-inch pipeline. the XX-inch of line a will east in project phase this Williamson of 'XX. the expected shale To Austin Katy. growth to to work XX-mile, Dallas-Fort that connect began XX-inch Worth line the phase

heard agents in service you've customer our my exceptional these times. continue challenging providing updates, and As during technicians customer service previous service

Thank for taking ‘XX, customers agents team, day. exceptional a year received fiscal from of our XX% care technicians our and During customers. every satisfaction ready you,

the such industry focus bill Our XX% over average payment XX for and our options payment of of around the XX%, as and strategic electronic payments delivery online is utility XX% September on methods of receiving digital drafts, total we as electronic cards, and credit benefits is as are of bills, while received bank customers yielding banking.

XXX XXX,XXX and classes. Atmos fiscal onboarded hours through we nearly training of employees new 'XX, Essentials our During approximately we provided

process and the All of 'XX, emissions of X operations strategy operations, facilities, environmental our areas: X, supply, completed in integrated following fleet, and proud focused this reducing teams. and training environmentally five activity and on comprehensive safety from gas a impact was various key and X, Scope our our customers. we virtually. initiatives operations into improvement business very our fiscal In I'm technical

at that environmental included transmission, imaging storage in things programs ongoing our fields, in each Our and to system emissions fiscal It efforts XX. troughs modernization sales in mentioned underground 'XX impact such equipment, of that as APT's earlier. of complete our the the capabilities cloud installation fiscal included APT reduce we will installation storage distribution remaining and that also gas

X detection We these We for fleet deploy our developed continued our light-duty gasoline than of summer, fields identifying gas we Humanity produce. rooftop these distribution completed with transportation BCF wish imaging the further we Greeley-Weld the cloud value vehicles our approximately Colorado. this our partnership use fiscal the they C we who of pneumatic system to 'XX, more to combined natural strategy for transitioning our opportunities a $XX activities. evaluating gas net it year, to to resources insulation R&G the type capture fiscal a produce to month bill. Projects appliances, vehicle nearly in with bleed a all technology, We're to We've to Texas. we currently G and opportunities. solar affordable In of in carbon a using across Habitat of methane R&G We a In consumes advanced hybrid transport that developed XX could reduce X expanded low gas increased also at technologies demonstrate vehicles. Evans, This that carbon uses high-efficiency additional approximately or energy transported in developing at bleed plan time We begin based, energy zero to In more low home strategy expand amount pipeline initiative. emission. are energy XX will and a our our system very in emissions and will and devices electric panels, and sources this homes no the September, wellhead, our of heavy-duty fixed joined home devices. maintenance like or cost for first and storage R&G from detection replace to customers late these

commercial Power and the As low of deployment development a Electric and carbon effort reminder, accelerate between this joint Research technologies. is Institute research Institute to and Gas working Technology X the

others over warmth I and trees, we nearing difference footprint utility customers the million $X wrap fuel natural X,XXX facility. providing snacks. lives by are across students honored to and donated we with X,XXX volunteer resources thriving to of neighbors into workers books, and be in from gardens. gas investment carbon reduce hosted We their fiscal cell our financial local XXX communities. talent, as of and I communities making financial now We meals updated proud Finally, still community in the I'm and X,XXX All of our share fiscal heroes our our with about banks discuss we were resources, the our and will 'XX communities. one working. into and because difference are powered worked turn electricity. to are we 'XX initiatives employees who our data of The fares, for need supporting of facilities will safe meals the a to carbon remarks. the generate fiscal as time, our provided food up community of fiscal team our second successful schools color cell Energy our the feeling in meals, as closing made as a and this 'XX, million additional Blitz X return as to XX. them results they will We will of fuel our provide very Chris, low guidance, nearly completion in at team substantially then decade and for support, shelters. move This call A and nearly a plan planted healthcare with translated with anticipated Chris, around for is well-positioned over Assistance some through of that over our financial has you. strategy. year. of us To 'XX fiscal X-year well some

Chris Forsythe

you, and morning, Thank everybody. Kevin, good

Our fiscal earnings prior increase $X.XX per the diluted of representing per over share of earnings 'XX X.X% year. reported diluted adjusted in $X.XX, share

tax a tax results $X.XX new $XX related to As per legislation GAAP of in share million our one-time XXXX diluted enactment fiscal included the benefit Kansas. income of a non-cash or reminder,

Non-residential conservatively in we carefully second of XX, the sales we anticipated, fiscal we XX% Though activities. planning than our the lower sooner and year. execute declined the manage revenues spending and expand to focusing M the early entered program. period-over-period into volumes sales we O O&M our half opportunity quarter, O&M for the quarter volumes first nonresidential on while spending planned to which second normal non-residential created fiscal As during our rebounded compliance-related

revenues fiscal timing on difference excess between and the contributed to XX about income taxes penny Additionally, impact of expense deferred deferred refunding results. the a our tax

operating $XXX increases provide rose income $XXX the spending actual closer X income the driven details higher-end touch of I for slightly a of will XX% and operating each totaled both a earnings-per-share to segments Slides guidance of few result, reliability segments. Taking Rate of changes increased X on our and million. safety to look, of a consolidated year As by highlights. our approximately year-over-year million. operating the in capital exceeded our fiscal range.

and growth $XX We in continue jurisdictions, to in our million benefit customer strong resulting increase from distribution most income. operating of a

almost our waiver During fees commercial in reconnections. months. declined customers, Service X% fiscal added million 'XX, 'XX, over X.X% about for order due and new which the primarily customer a of customers distribution we our $X.X increase fiscal to XX,XXX last the represents rising revenue volumes recovered last Sales disconnections for over our segment XX year. service

$XX activities help our flexible find remain to collection in close bad year-over-year. third about contact continue and Bulk we the million regulators. Additionally, expense and debt customers increased resume payment quarter, financial offer in arrangements, with our assistance,

believe increased safety, pipeline to this be expense, $XX on million focus and debt including Consolidated enhanced integrity work, [Indiscernible] a bad debt, leak excluding over continue and records establishment, We system time. will surveys, recovered bad and continued retention. with

return over this of quarter. and by Additionally, excess requests million to In in of over We the increased damage the additional the investments XX% and system. period $XXX result with of operating liabilities. annualized deferred our line of activity XX% capital X to awareness began spending for increases. increased have effects $X towards reached earn modernize XX, tax year, XXXX a Capital billion directed $XX operating third-party a efforts. fiscal the of safety, accomplished million of the agreement environmental of fiscal income and to spending performance during the of end. first fiscal locate income as our we and amortization months regulators reliability, Since implementing our increased X% our annualized within economic spending test Excellent of end our

four of Slides XX As have our pending XX we about today, activities. $XX regulatory million. summarize to filings seeking

'XX issued for forward support equity equity $X.X We proceeds $XXX our under fiscal our net million long-term Under ATM we During and program, $XXX million fiscal satisfied program. X of shares over that X shares financing of for through fully we or approximately completed sales settled debt 'XX, needs operations. approximately ongoing million. billion to equity million, and agreements we

$XXX This debt financing arrangements satisfy remaining As that needs. had under we equity our of existing issued financing fiscal fall. long-term last complemented will equity million we significant equity $XXX September portion of XXth, approximately million 'XX a the forward of

during Additionally, we flexibility financial improved 'XX. fiscal our

During quarter, renewed, the credit under an facilities. extended, we our second in increase non-liquidity

as extended have Our to day, our facility primary and a credit March with X-year to storm million under hearing. a $XXX facility facilities replaced unforeseen facility events feature, XXXX accordion The available expiring million, facilities. billion million now new to was X-year and billion flexibility accordion feature. financial improves X We respond these XXX $X.X of $XXX $X.X $XXX with credit $XXX the ability provide credit such winter our million retained we

and support Additionally, billion new a $X we financing million issued plans shelf statement registration fiscal new and a $X ATM 'XX our program for beyond. to

support Additionally, during quarter swaps. mitigated starting future forward financing rate swaps interest interest future $X.XX to we executing billion we rate needs. have debt risk by of the Currently our long-term in million fourth $XXX

needs. of our interim billion our incurred pay Finally, continue job team Uri, in did $X.X for gas treasury upstanding effective costs winter all supporting an storm for operational to the cost financing our in which ability outstanding to preserved during

financing XXth. activities, of these was financing, equity XX.X% September winter storm $X.X as result billion our the As of of a capitalization, excluding

$X.X as finished approximately year next and liquidity, financial to financing We've operations balance found year. strength fair the we Slides liquidity, Details fiscal the move to profile 'XX. X on be XX. into of fiscal we billion winter Additionally, we our activities for can our fiscal just of total and sheet of also and well-positioned with

procurement inflation our chain team that has and You discuss in heard our risk operations. Kevin supply mitigated

done supply preparing our winter season. the has chain also job supply gas heating Our for an upcoming strategy gas excellent

cost approximately contracted of XX% Our and storage is for weighted full $X. average over proprietary a gas

team our on and basins person use purchases of capacity for purchase X/X XX at financially approximately which across Through Today, Additionally, have through mid-$X baseline wide approximately had supply expected footprint our purchases hedged winter in gas contracts, of customers. spot range. we normal prices remainder producing gas provides a transportation the for to satisfied but natural The purchases, supply X-state supply peaking the X/X anticipating requirements a competitive variety and in our usage prices and ensure we of storage of of on we stabilized we of prices, hedge our $X. and about have physically to pipelines needs, reliability access our gas combination needed.

reminder, helps gas all involves and purchase average recovered move process are the the impact through weighted the over a cost As approach, incur us XX mechanisms customer bills. we months, journey gas a generally costs which in

can as and been we've higher Finally, how we they various energy well potential ways customers with help mitigate actively installment communicating about them assistance with plans, budget energy to our billing, the agencies. the conservation, their of can bills locating through prices gas impact as

Details organic second initiated guidance our of come to we 'XX Looking can about Also earnings-per-share the Slides fiscal over to safety-focused our Atmos our quarterly $X.XX increase yesterday, on 'XX strategy. is guidance XX%, Board $X our the Directors dividend indicated for from X.X% cash Energy's expect approved pursuing in XX 'XX we surrounding will 'XX years, consecutive forward, prior decade annual fiscal of dividend. segment. X/X 'XX. earnings range XXXnd $X.XX. begin fiscal of Yesterday, The of a fiscal and be found distribution and fiscal growth our with Consistent will XX.

in X/X 'XX that few Slide it's as 'XX, months our earning XX is capital $X.X 'XX APT, fiscal end. Kevin capital plan. result the test a spending X-year fiscal minutes work X expected period the within a 'XX summarizes return underlying is XX% to fiscal Over begin to ago. be of the increase range of incurred themes described project billion key by will of the when be billion. to this Most our rise XX%, $X.X of which spending to of and spending capital represent Finally, approximately in expected at expected fiscal

to to anticipate per fiscal be share and earnings of range next per X% $X the 'XX, X in anticipate earnings year. we will share per the By X% years, grow Over $X.XX. we

anticipate to per also in line increase We earnings with share. dividends annually share per

system and for increase anticipated Continued earnings per the improvements, capital spending driver modernization, environmental in spending, be the per share replacement expansion fiscal primary 'XX. income and through will consistent net

Over approximately spend level of total XX% into XX% to per an rate-based to estimated activities translates safety. $XX year. is to This an billion about the years, of billion From the 'XX. that This at $XX five spending we fiscal 'XX, we in to of billion anticipate address compliance-based about billion. $XX focus up system next support base to at expected right $XX billion end fiscal on of continue perspective, from O&M growth $XX

'XX, O&M $XXX inflation of we range anticipate and fiscal we to $XXX fiscal from For annually to assumed to O&M through million X.X% million 'XX. X%

addition over the refunds million spending back to to excess will had In outlined; plans $XXX the years assumed in I we next X tax deferred approximately flow customers.

our we tax years assumes we level, be will changes we've rate rate and of fiscal Sheet. X% XX%. the As Balance to strength been being This strategy to the the financing tax perspective, are follow in last preserve a our result, currently at expect continue between executing effective the the no considered 'XX federal financing and to few

favorable anticipate X short-term to we in earnings-per-share a profile XX In with issuance forward and billion of effective ratio, senior a of target million debt securitization, our the note incremental financing. has completed starting rate guidance and this XX-year a in reflected maturity plan of $X factoring weighted $X.X raise The years. mix billion manageable X.XX%, long-term analysis a storm the the Sheet years, with to financing XX% XX% X.XX% settlement our fully long-term financing between 'XX. on equity October, very next and of of issuance our This capitalization $XXX debt is over billion equity use inclusive fiscal debt. the rate to winter average financing incremental remains a been need Excluding excluding prudent of interest $X a after Balance swaps, to coupon through strength we of

to our mentioned, to preferred risk. previously program we rate equity a have continues ATM I our as substantial of our perspective, equity. portion be interest long-term for method raising debt needs From hedged Finally, utilizing an anticipated mitigate

needs our equity needs earlier, the our remaining of 'XX forwards executed 'XX. mentioned through a program. portion we our I expected satisfy equity ATM we fiscal equity fiscal expect for rage significant fiscal 'XX to will during As

fully a have we months. few of Securitization, Texas last progress regulatory final substantial the that Statewide issued securitized Railroad asset stipulated all order program. and recoverable. costs order. Regarding to Commission in determination our for next of are The the final issue will the The made step the prudently be a of gas storage and under is that Commission unanimously Yesterday, financing incurred Bureau are

of will March. has we the of we repay Financing the financing Texas XXX we the Securitization our securitization issuance winter complete In of securitization application to Upon billion up Following to transaction. the $X.X Public days filed receipt last mid-September. funds, Kansas, the the order, storm financing issued Authority in

been and set, proceedings We questions, responding are all schedule January. begin with currently to various procedural a expected in has to

smaller more mechanisms These with primary attract we adjustments capital a bills capital the returns necessary made providing our regular capital modernization which these annual and produce impact system enable filing to to means to deploy our support customer recover mechanisms we'd Finally, spending. rate efforts. efficiently to the mechanisms generate finance that while the to our us and investments, spend,

of your this I earnings now call for as fiscal the us for impact and 'XX, Kevin million outcomes for fiscal have plan through various those no Thank will capital X% regulatory 'XX. mechanisms, changes timely his The turn regulatory will remarks. to execution sustain supports to anticipate spending, execution years, this grow plan and range time long-term modernize see back investments you to to these to of morning. closing the also and for to plan keep financing, affordable 'XX. bills that The recovery our mechanisms material fiscal In through disciplined Kevin? dividends ability in $XXX it long 'XX will million term. help you the X share can we and this Slide We this per on in annualized filings $XXX completing assumed fiscal annually our and balanced system to all customer XXXX, our of XX.

Kevin Akers

you, Thank Chris.

sustainability gas and per Company. safety foundation direction The We XX% about dividend fully situated rate jurisdictional proven with our very of a have natural our a choice. X strong footprint Looking is states supported earnings by the organic share regulatory as with long-term commensurate to in our growth forward, growing The systems. of has said, X% regulated of infrastructure. basis set excited in driven our accompanied in necessary been passed natural Chris yield, the that support share diversified and operate profile. per jurisdiction growth, constructive that and financial I'm a of capital to strategy X% in modernize of storage investments supportive energy in investment X mechanisms that our support legislation gas distribution, transmission, the

capital We of system. and Slide transmission over of billion X,XXX XX X,XXX have the total X% miles That will support X work you replacement years pipe, distribution a see planned XX. our $XX X% in long of about on $XX as to next to or billion spending of to to can the runway support spending and

reduce emissions inventory XXX,XXX to also system service replacement XX% to between is approximately replace level to work XX%. our expected XX% XXX,XXX methane of to that by reduce period. X-year plan lines, to from We our over by steel is which expected This

Austin. growth XX fastest-growing the Additionally, us you've north serve in of are X Metroplex the in DFW our jurisdiction. we to and discuss of the heard counties the

online, XX a between footprint annual to natural choose 'XX, among the added hospitals an various ranks In Tennessee, continue year fiscal our the BCF customers gas. we they in new food XX areas our in to are growing well, distilleries. U.S. and these load service as approximately customers with territory see industrial fastest of Additionally, and XX and industrial we processing, once are from manufacturing, customers fully industry, Middle estimated

been questions. call strategy and a to our our in homes, reflected now vital on safe, future. the play our natural efficient energy to appreciate this role your has into as of and open the fuel time in needs industries the day Delivering gas We every Focusing and now we the and businesses, for sustainability we'll morning, always long-term part communities. reliable,

Operator

go floor The is from now first you. [Operator for question questions. America. of Thank of ahead. open is Our Julien Instructions] Please Bank Dumoulin-Smith coming

Kody Clark

Hey, it's on morning. Kody Clark Julien. for Good actually

Kevin Akers

Kody. Good morning, are How you?

Chris Forsythe

Kody. Good morning,

Kody Clark

Good.

the the dilution in there, the given any that so mechanisms first recovery jurisdiction, of delta equity XX% I'm definitely that to that the cognizant a and but X% delta know I plan, there's between on growth you deal drivers your of base out. are X% So XX% EPS you good lag, there contemplated rate of growth. the would low other so wondering across like call regulatory have if to

Kevin Akers

that's into At is morning. just over out, time, point component. X% equity the share years as it next this that Yes. the we've X% that highlighted per it's But we the plan on assumed really call you five financing growth again, factored the to the earnings this

Kody Clark

it. Got

updates I'm asking growth because that it year, more to the a X would little EPS range. the you strong Okay. X% X% the or then growth the off towards off during of I'm how to number performed I've X% that And couple you midpoint XX? and then top wondering Is well question reiterate past bit. that. year-end building seen rebase after that you characterize where see long-term in yourself

little a being would or you bit think about that? you are how So conservative

Kevin Akers

ranges $X we've When for $X.XX $X.XX the fiscal at out that to put to you and morning, the fiscal look then 'XX, this XXXX. $X.XX the in

If you annual that X% kind midpoint the of per about rate both of and a those implies growth ranges and math of do take the year.

Kody Clark

throughout year, to can transaction relative then sneak peers time at multiple the for Okay. same gas has market just of multiples utilities if utilities. seen electric some seen gas I the healthy last in it the and the the And decline We've that. some one for

past you've potentially you at mix, needs. I asset all. know your business equity wondering monetizing an assets are changed thinking to the about or ATM how has that you'd So if thing in like offset but stated the

Kevin Akers

wants that, Again, he and on been very can assets. to. as start Chris we've proud Kody, if jump of our in you said, I'll then certainly

We very proud continue be to of them.

the You at look results here.

proud You in our talked about the have of We're the out our that just relationships mentioned we here, the the very we mechanisms, that we call the involvement have on there, mix today. diversified regulatory asset growth communities.

contemplating So point excellent the at continuing assets. we're those of anything, but not operation this

Kody Clark

I all That's had. Great.

Chris Forsythe

Kody, I’ll add…

Kody Clark

Okay. Very good.

Operator

you. Thank

next Richard Please Our is JPMorgan. from go coming question ahead. Sunderland of

Richard Sunderland

morning. here. Hi. taking Good for my Thanks questions

to project. pipeline? create Permian this highway Does incremental takeaway start to with or it wanted connectivity Permian Just just the base better and highway

Kevin Akers

highway project where growing the just that down are Well, that a well about that's we in for diversification to corridor the us. project, of that of talking to Permian demand connecting load meet up feel as there Austin you're

Sal moving project of to connecting So, this We're point. from that's to north bringing what do. over gas to it Permian Highway that that at around Katy bringing from from instead or we're up the the looking supply

to again, optionality us, diversification. there, another corridor then that growing for have down some and supply So meet we the it's supply

Richard Sunderland

entire year-over-year. Understood. And is step-up plan then any up or CapEx color five-year I there anything realized XXXX there? the just notable But the is in capital

Kevin Akers

again. Well, and up each at robust planning year that out levels think process projects and three, five-year We go nothing I that the that looks steps a one, through very are rigorous there.

how As goals, it but heard say integrity I a before, that growth do that's to be out take compliance at management we projects what the look future the within That's out those has we in meet demand? you've from spiked we this. think going meet that been why all So and projects. band also us long how and goals, at contemplated we look I perspective, the

to about. diversification to continue a demand I this So we the further iteration is just and supply that meeting of think talk needs

Richard Sunderland

color. you Great. for Thank the

Operator

you. Thank

from ahead. coming Please Kim is Goldman go question next Insoo of Sachs. Our

Insoo Kim

limited other that what in Thank that's dome just rules general but hedging. is gas put that, to salt coming in capacity some states the and spikes the you're Texas on know going of it's but are we're those first on hedging with the seeing question the or is the season, commissions current of storage I a to it's dialogue regions, just other result just commissions on the following the changing whether Uri help strategy? you. My whether or any that on winter of hedging potentially any

Kevin Akers

Chris see to any start I'll add out wants Yes, then and if color.

But our we've heard right is now, purchases, We're of heating comfortable commissions, plans year very that our this how have combined they us put you load that our to going with how to out We together. laying have with season. the you able gas supply And following sort every positioned year. dialogue our that we winter plan well gas anticipated base both are our feedback. teams what commissions, been the things, opportunity, supply open as our perform for know, those into storage with year,

So continue see those of dialogues, and continue forward. with the as work those continue jurisdictions each with winter season we'll at conversations, end our collaboratively those to they it jurisdictions meet we'll of going each

Insoo Kim

my And proposed question, methane that's the in second the it. package. reconciliation fee Got

upstream of but LDC side or any the your direct thoughts see or on midstream in your gas ramifications on general? and the think whether for just curious indirect, things, impact utilities I or industry just more you it's or potential

Kevin Akers

economic growth, energy gas And provides key continue and in and natural believe we're today. plays And have outlined as reliability, lot going to a There's lot they in we world States, a that need going we the We're gas through and that from to say conversation perspective frankly, to of brings producers and the before that a top certainly natural among just with as thing flexibility, pieces But table you've the that. today, still gas. diversified United I in role think to national reserves is portfolio. stability, proven A heard to among have And We sit that continue five the the parts is a to do here we still level the federal that. the for everybody. how that, natural need continued legislation. today's top five and abundance of security to with energy we'll economic the it the moving us the on at quite perspective, that. monitor an us is update

So we'll demands of for continue to look energy monitor that, the portfolio but U.S. we will to the meet continue to diversified a

Insoo Kim

We'll Got you, it there. both. it. leave Thank

Operator

Thank you.

Stephen Byrd next ahead. Morgan is question Our of Please coming go Stanley. from

Stephen Byrd

Hey, good morning.

Kevin Akers

Good morning.

Chris Forsythe

Steve. Hey,

Stephen Byrd

Hey.

jurisdiction, on impact gas the big topics there point, covered. is don't your though, two Slide to that cause natural pricing shocks. cause things. any impact, So a shocks what see think we that? constructive for really to envision lot whether of it touch quite is or X be Maybe where that the in or could could or 'XX, been of could fairly increase that an hard different, worse guess, in example, I bit just assumption greater my dynamics for it have that modest Are little to different, question or a kinds line to is, change, jurisdiction, back on wanted be it's is XX, I I first, to bottom

Chris Forsythe

Kevin. ahead, Go

Kevin Akers

Go sorry. ahead. I'm

Chris Forsythe

know, impact out averages earlier, we're are for multiple pipes us heard Well, diversification as continue you this mentioned across there, I across we don't us pipelines, you we look our to those at anything put foresee point, basins. XX that as could that

much we tried to in flexibility we systems. as blend can So and diversification within our as

at is conservative I some mechanisms outlook as those that way increases the $X.XX cash we're level over bars at believe on while to of the and $X.XX out, out We these those for is future looking prices, into on today, and there tend and annual heard you've on non-Maxx Katy today. us have think as basis hard say XX, to before, I gold $X.XX time,

So the difficult too X-state could great customer up footprint to that the as to I'd terms team assets that experience our what our want again, that portion sums weather U.S. are it's you or the pricing, we what again, multiple we're and that's and dynamics Kevin sort move that really saw come located predict Texas all again, difference Yes, with true of position. add? geographical potentially that very, does, have patterns. to might you weather estimate in say, patterns anything from a pricing just storage, the with with it's very impact needle completely It in we and in and are described. good thing, Chris, significant pipes, I of Also, of that on work, could impact, to Colorado. just of where in supply gas eastern fairly availability a usage an trying think there a covers and about the

to I it's, trade us for. challenging really, key X-state across the for say pretty think, to So footprint a watch if out driver is there

very the be all going that it's think highly of have liquid the basins to you a They're basins. just pricing, to. I we of items access mentioned; combination

pricing able what usage, have on patterns. as a that weather were situation customer general we to as well eye keen So just good

Dan Meziere

I That's little going this a am really helpful, on in step question. is back bit and really a Atmos then to to interesting shifting financing, over situation.

companies You cap to base is multiple seen have PE We a perhaps the fastest asset your compared the outlook. just growth growth valuations. among lower rate private the is stock, needed we've of stock in high, amount we interesting seeing and than of what we're just not the your the is dramatically minority love of higher equity market of dramatically value XXX%, sales, cover. that the What's the stake, rate of but including in terms a sales selling

How that? your than potentially next years. own guess you higher the valuations looking kinds been that sale dilutive kind much about would possibility at a this math think of stock that trading? multiples seeing of other selling on all where less we're be minority at suggests we've over of of I issuance a do of my volume is stakes, the just situations X do So the think the stake of kind equity dramatically about than minority non-controlling you-all How

Chris Forsythe

of Company for peers don't It's our a many the like holding have us do. we challenge because structure

look each states, that's under of you umbrella. or when one So divisions our all corporate of at each our

to be what jurisdictions investors bit experienced public we we're are and in our and we're market talk fact and and very have place see customer would we we is XX% traded or can't a jurisdictions very assets happy the region again partial on We evaluation that strong the private currently where that regulatory in the from a have with Kody, jurisdictions we need that being would jurisdiction. we're gas, with perspective, the the that you public Kevin growth our footprints. a seeing support geographic have asset from do the think we a earlier the those have, to that jurisdiction little a we that of both to located remind growth are natural and base to what a minority trade have the we of exit, just dislocation between So single structured of perspective, that the fact heard today, the very as continue in do versus gas. is it way that's perspective underappreciated, The perspective, supportive natural sale is country assets have certain to sale for strong the to capture a well-positioned policy

Kevin Akers

our got had just increases XX as strong of Chris years what our Yes. growth consecutive about Chris, well years of EPS jurisdiction. support XX all regulatory you've add position I'll and dividend as

So fits our solid. outlined, we're think we do going within to it's jurisdictions it strategy. continue the our things to well. operate We do We've and we think

communities position So really our all only believe for not going in we are our good stakeholders. customers forward, a but and

Stephen Byrd

much. Thank Understood. very you

Operator

Thank next Our Please Levine of you. Instructions] [Operator question go ahead. Ryan coming is Citi.

Ryan Levine

morning. Good

Chris Forsythe

Good morning.

Kevin Akers

Ryan. Hey,

Ryan Levine

determine the in where talk XX% that outcome? about some minuses or range may EPS? pluses the would for the are you Can of Hey. the What of you fall drivers

Chris Forsythe

compliance we strategy. to bit just that Key a X% patterns, ongoing those drivers normalized, we pluses range. jurisdictions, that spending timing or we the weather we our although of usage can minuses O&M point are little and the XX% within regulatory where fall talking Customer [Indiscernible] of obviously we're we will the work, as safety and to when see of whether be continue execution of about key can system our the are generally X% year-over-year,

Ryan Levine

O&M point, you in driving X%, O&M that assumption? what's the outlook, elaborate to X.X% that? on what 'XX On assuming can robust more underpins your think you're some cost figures inflation more X% inflation Seeing recently,

Chris Forsythe

expansion work. compliance ongoing the It's our of Sure.

back year rate compliance now, every than doing case in heard and talk for occur. another rather that You've to us more holding waiting before work mode we're a

needs have is advance deadline also we that, to deadline it continue at work level, time look in at So happening when just there. to the that as from getting that of get compliance Well federal so the we're and the try and we a the on rule we perspective. be what state a making ahead that's comes at and met, we're looking want to safety doing to system when for to

some expanding can. possibly further operating well at sure ongoing transmission of better technologies as just detection that our our inspection about when So is footprint, large-scale across make distribution and leak work that as hydrotesting as on system advanced to as lines it talked safely in inline

Ryan Levine

from the do you federal view and more Okay, legislation, the broadly? what to impact then Atmos as

Kevin Akers

infrastructure Ryan? to Are the bill you there, referring

Ryan Levine

potential and infrastructure changes. or reform The bill tax tax

Kevin Akers

in the gas know, focusing are On development, we're in high-efficiency there think, X-year very that some, things piece as as through the bill natural next the well comprehensive, way through we're on point, of million the this in That's well. at Gas it there's that over low heat. appliances, that $XXX of we and The our still rest infrastructure companies as working it's for it, our of some as you peer American increase there way seen so with research with, our systems hydrogen itself, we've I for or and but detailed that still Association. with working our regard the incentives

Ryan Levine

few jurisdictions talking to of within any rate-basing Okay, your and then the me. within question you Are last LDC? electrolyzers for your regulators about

Kevin Akers

Short answer is no.

Ryan Levine

it. appreciate I Thank you.

Operator

Thank management this to like for closing over turn the comments. you. At floor back to I time, would

Dan Meziere

thank you website recording of joining for today. available January for replay through our a appreciate interest day. The Atmos this in We Thank X, on XXXX. good us you. your Have is call and Energy

Atmos Energy (ATO) 12 Nov 212021 Q4 Earnings call transcript