Group 1 - ONE Gas, Inc. plans to make a public offering of 2,500,000 shares of its common stock [1][3] - The offering includes an option for the underwriter to purchase up to an additional 375,000 shares [1][3] - J.P. Morgan Securities LLC is acting as the sole underwriter for the offering [2] Group 2 - The forward sale agreement allows ONE Gas to sell shares at a price equal to the underwriter's purchase price [3] - Settlement of the forward sale agreement is expected to occur no later than December 31, 2026 [3] - ONE Gas may elect cash settlement or net share settlement for its obligations under the forward sale agreement [4] Group 3 - Proceeds from the offering will be used for general corporate purposes, including debt repayment and capital expenditures [4] - ONE Gas is a regulated natural gas utility serving over 2.3 million customers in Kansas, Oklahoma, and Texas [7][8] - The company operates divisions including Kansas Gas Service, Oklahoma Natural Gas, and Texas Gas Service [8]

Part I. Financial Information [Item 1. Consolidated Financial Statements (Unaudited)](index=8&type=section&id=Item%201.%20Consolidated%20Financial%20Statements%20(Unaudited)) Presents the unaudited consolidated statements of income, balance sheets, cash flows, and equity for Q1 2025 [Consolidated Statements of Income](index=8&type=section&id=Consolidated%20Statements%20of%20Income) Net income increased to $119.4 million in Q1 2025, driven by a 23.5% rise in total revenues Consolidated Statements of Income (Unaudited) | | Three Months Ended March 31, | | | :--- | :--- | :--- | | (Thousands of dollars, except per share amounts) | **2025** | **2024** | | **Total revenues** | **$935,190** | **$758,320** | | Cost of natural gas | 512,462 | 383,003 | | Total operating expenses | 242,229 | 229,457 | | **Operating income** | **180,499** | **145,860** | | Interest expense, net | (35,697) | (31,357) | | Income before income taxes | 145,320 | 118,011 | | **Net income** | **$119,419** | **$99,317** | | **Diluted EPS** | **$1.98** | **$1.75** | | Diluted average shares (thousands) | 60,266 | 56,800 | [Consolidated Balance Sheets](index=10&type=section&id=Consolidated%20Balance%20Sheets) Total assets were $8.33 billion as of March 31, 2025, with a slight increase in total equity to $3.19 billion Consolidated Balance Sheet Highlights (Unaudited) | (Thousands of dollars) | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$8,327,240** | **$8,425,571** | | Net property, plant and equipment | 6,738,620 | 6,645,873 | | Total current assets | 756,238 | 929,881 | | **Total Liabilities** | **$5,142,205** | **$5,321,023** | | Total long-term debt, net | 2,370,402 | 2,385,286 | | Notes payable | 811,900 | 914,600 | | **Total Equity** | **$3,185,035** | **$3,104,548** | [Consolidated Statements of Cash Flows](index=12&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow rose to $277.5 million in Q1 2025, while financing activities used $160.0 million Consolidated Statement of Cash Flows Highlights (Unaudited) | | Three Months Ended March 31, | | | :--- | :--- | :--- | | (Thousands of dollars) | **2025** | **2024** | | **Cash provided by operating activities** | **$277,459** | **$108,262** | | Cash used in investing activities | (167,845) | (165,981) | | Cash provided by (used in) financing activities | (159,963) | 39,804 | | **Change in cash, cash equivalents, and restricted cash** | **(50,349)** | **(17,915)** | [Notes to Consolidated Financial Statements](index=14&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Details key accounting policies, revenue disaggregation, debt, equity, and commitments for the single reportable segment - The company operates in one reportable business segment: regulated public utilities delivering natural gas to approximately **2.3 million customers**[31](index=31&type=chunk)[32](index=32&type=chunk) Disaggregated Revenue (Three Months Ended March 31) | (Thousands of dollars) | 2025 | 2024 | | :--- | :--- | :--- | | Natural gas sales to customers | $875,248 | $689,505 | | Transportation revenues | $43,748 | $39,967 | | Securitization customer charges | $11,637 | $11,671 | | Miscellaneous revenues | $6,624 | $6,308 | | **Total revenues from contracts with customers** | **$937,257** | **$747,451** | - The company has an at-the-market (ATM) equity program with **$225.5 million available** for issuance as of March 31, 2025[54](index=54&type=chunk) - Kansas Gas Service has deferred **$30.8 million** for remediation costs for former MGP sites and requested to increase its recovery cap to $32 million[73](index=73&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=29&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management analyzes Q1 2025 results, regulatory activities, capital plans, liquidity, and cash flows [Financial Results and Operating Information](index=30&type=section&id=Financial%20Results%20and%20Operating%20Information) Operating income grew by $34.6 million year-over-year, driven by new rates and customer growth Selected Financial Results (Three Months Ended March 31) | (Millions of dollars) | 2025 | 2024 | Increase (Decrease) | | :--- | :--- | :--- | :--- | | **Operating income** | **$180.5** | **$145.9** | **$34.6** | | Total revenues | $935.2 | $758.3 | $176.9 | | Cost of natural gas | $512.5 | $383.0 | $129.5 | | Operating costs | $160.5 | $152.8 | $7.7 | | Depreciation and amortization | $81.7 | $76.6 | $5.1 | - Key drivers for the increase in operating income include a **$51.9 million revenue increase** from new rates and a **$2.3 million increase** from customer growth[119](index=119&type=chunk) - The total number of customers grew by 15,000 year-over-year to **2.305 million**, driven by new connections in all service areas[118](index=118&type=chunk) [Regulatory Activities](index=29&type=section&id=Regulatory%20Activities) The company filed for rate increases in Oklahoma, Kansas, and Texas to recover costs and investments - **Oklahoma:** Filed for a **$41.5 million** base rate revenue increase under the PBRC mechanism[99](index=99&type=chunk) - **Kansas:** Requested a **$7.2 million** increase related to its Gas System Reliability Surcharge (GSRS)[100](index=100&type=chunk) - **Texas:** Made GRIP filings requesting a total of **$26.8 million** in rate increases across three service areas[101](index=101&type=chunk)[102](index=102&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity is maintained via operating cash flow and a $1.35 billion commercial paper program with stable credit ratings - Primary liquidity sources are operating cash flow and a **$1.35 billion commercial paper program**, supported by a $1.35 billion revolving credit agreement[123](index=123&type=chunk)[128](index=128&type=chunk)[129](index=129&type=chunk) - At March 31, 2025, the total **debt-to-capital ratio was 50.2%**, well below the 70% covenant limit[46](index=46&type=chunk)[126](index=126&type=chunk) Credit Ratings (as of March 31, 2025) | Rating Agency | Long-term Rating | Short-term Rating | Outlook | | :--- | :--- | :--- | :--- | | Moody's | A3 | Prime-2 | Stable | | S&P | A- | A-2 | Stable | [Cash Flow Analysis](index=35&type=section&id=Cash%20Flow%20Analysis) Q1 2025 operating cash flow increased to $277.5 million due to working capital changes Cash Flow Summary (Three Months Ended March 31) | (Millions of dollars) | 2025 | 2024 | Variance | | :--- | :--- | :--- | :--- | | **Operating activities** | **$277.5** | **$108.3** | **$169.2** | | Investing activities | ($167.8) | ($166.0) | ($1.8) | | Financing activities | ($160.0) | $39.8 | ($199.8) | - The increase in operating cash flow was primarily due to **working capital changes** related to the recovery of regulatory assets[140](index=140&type=chunk) - The increase in cash used for financing activities was primarily due to the **repayment of commercial paper**[141](index=141&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=40&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Primary market risks include commodity prices, interest rates, and credit, which are actively managed and mitigated - Commodity price risk from natural gas price fluctuations is mitigated by **purchased-gas cost adjustment mechanisms**, which pass costs to customers[162](index=162&type=chunk) - Interest-rate risk is associated with commercial paper and new debt financing, and is managed using a **mix of fixed-rate and floating-rate debt**[163](index=163&type=chunk)[164](index=164&type=chunk) - Counterparty credit risk is diversified across approximately **2.3 million customers** and is not considered material[165](index=165&type=chunk) [Item 4. Controls and Procedures](index=41&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal controls over financial reporting were effective - The Principal Executive Officer and Principal Financial Officer concluded that **disclosure controls and procedures were effective** as of the end of the reporting period[166](index=166&type=chunk) - **No material changes** to internal control over financial reporting occurred during the quarter ended March 31, 2025[167](index=167&type=chunk) Part II. Other Information [Item 1. Legal Proceedings](index=41&type=section&id=Item%201.%20Legal%20Proceedings) Ongoing litigation from normal business operations is not expected to have a material adverse effect - The company states that it is a party to various litigation matters from the normal course of operations, but believes the probable outcome **will not have a material adverse effect** on its financial condition[168](index=168&type=chunk) [Item 1A. Risk Factors](index=41&type=section&id=Item%201A.%20Risk%20Factors) Refers to the company's Annual Report on Form 10-K for a detailed discussion of relevant risk factors - Investors are advised to refer to the **Risk Factors section in the company's Annual Report** for a comprehensive discussion of risks affecting the business[169](index=169&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=41&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section is not applicable for the reporting period - Not applicable[170](index=170&type=chunk) [Item 5. Other Information](index=42&type=section&id=Item%205.%20Other%20Information) No directors or Section 16 officers adopted or terminated Rule 10b5-1 trading plans during the quarter - **No director or Section 16 officer** adopted or terminated a Rule 10b5-1 trading plan during the quarter[173](index=173&type=chunk) [Item 6. Exhibits](index=42&type=section&id=Item%206.%20Exhibits) Lists all exhibits filed with the report, including certifications and XBRL interactive data files - A list of all exhibits filed with the Form 10-Q is provided, including **certifications and XBRL data files**[175](index=175&type=chunk)[176](index=176&type=chunk)

ONE Gas, Inc. (OGS) reported first-quarter 2025 operating earnings per share (EPS) of $1.98, which beat the Zacks Consensus Estimate of $1.85 by 7%. The figure also came in 13.1% higher than the year-ago quarter’s earnings of $1.75. (See the Zacks Earnings Calendar to stay ahead of market-making news.)OGS’ RevenuesONE Gas recorded revenues of $935.2 million, which surpassed the Zacks Consensus Estimate of $804 million by 16.4%. The top line also increased 23.3% from $758.3 million in the prior-year quarter. ...

ONE Gas (OGS) Q1 2025 Earnings Call May 06, 2025 11:00 AM ET Company Participants Erin Dailey - Director of Investor Relations & SustainabilityRobert McAnnally - President & CEOChristopher Sighinolfi - Senior VP & CFOCurtis Dinan - Senior VP & COOBill Appicelli - Executive Director, Head of North America Power & Utilities ResearchChristopher Jeffrey - Equity Research Senior AssociatePaul Fremont - Managing Director Conference Call Participants Julien Dumoulin-Smith - Research Analyst Operator Good day, and ...

ONE Gas (OGS) Q1 2025 Earnings Call May 06, 2025 11:00 AM ET Speaker0 Good day, and welcome to the ONE Gas First Quarter Earnings Conference Call and Webcast. Today's conference is being recorded. At this time, I would like to turn the conference over to Erin Daly. Please go ahead, Ms. Daly. Speaker1 Thank you, Cole. Good morning, everyone, and thank you for joining us on our first quarter twenty twenty five earnings conference call. This call is being webcast live and a replay will be available later today ...

Financial Performance - ONE Gas reported revenue of $935.19 million for the quarter ended March 2025, reflecting a 23.3% increase year-over-year [1] - Earnings per share (EPS) for the quarter was $1.98, up from $1.75 in the same quarter last year [1] - The reported revenue exceeded the Zacks Consensus Estimate of $803.58 million by 16.38%, while the EPS also surpassed the consensus estimate of $1.85 by 7.03% [1] Key Metrics - Natural Gas Sales - Transportation volumes reached 65,300 MMcf, exceeding the average estimate of 64,475.83 MMcf [4] - Total Sales Volumes Delivered for Natural Gas were 79,300 MMcf, compared to the average estimate of 72,123.38 MMcf [4] - Total Volumes Delivered for Natural Gas amounted to 144,600 MMcf, surpassing the average estimate of 136,632.5 MMcf [4] - Residential Natural Gas Sales volumes were 58,900 MMcf, higher than the estimated 56,064.04 MMcf [4] - Revenue from Natural Gas Sales was $870.40 million, exceeding the average estimate of $719.29 million [4] Stock Performance - ONE Gas shares have returned +6.6% over the past month, outperforming the Zacks S&P 500 composite's +0.4% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

Group 1: Earnings Performance - ONE Gas reported quarterly earnings of $1.98 per share, exceeding the Zacks Consensus Estimate of $1.85 per share, and up from $1.75 per share a year ago, representing an earnings surprise of 7.03% [1] - The company posted revenues of $935.19 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 16.38%, compared to year-ago revenues of $758.32 million [2] Group 2: Stock Performance and Outlook - ONE Gas shares have increased by approximately 13.3% since the beginning of the year, while the S&P 500 has declined by 3.3% [3] - The current consensus EPS estimate for the upcoming quarter is $0.55 on revenues of $407.66 million, and for the current fiscal year, it is $4.26 on revenues of $2.34 billion [7] Group 3: Industry Context - The Utility - Gas Distribution industry is currently ranked in the top 12% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Another company in the same industry, Northwest Natural, is expected to report quarterly earnings of $2.09 per share, reflecting a year-over-year change of +23.7%, with revenues anticipated to be $478.17 million, up 10.3% from the previous year [9][10]

Financial Performance - First quarter 2025 net income was $119.4 million, or $1.98 per diluted share, compared to $99.3 million, or $1.75 per diluted share in Q1 2024, representing a 20.5% increase in net income [2]. - Operating income for Q1 2025 was $180.5 million, up from $145.9 million in Q1 2024, reflecting a 23.6% increase [3]. - Total revenues for Q1 2025 were $935.2 million, compared to $758.3 million in Q1 2024, indicating a 23.3% year-over-year growth [20]. - Net income for the same period rose to $119.4 million, compared to $99.3 million in the prior year, reflecting a year-over-year increase of about 20.4% [33]. - Operating income for the three months ended March 31, 2025, was $180.5 million, up from $145.9 million, marking an increase of about 23.7% [33]. - Natural gas sales reached $870.4 million, an increase from $694.1 million, indicating a growth of approximately 25.4% [33]. Dividends and Guidance - The board declared a quarterly dividend of $0.67 per share, an increase from $0.66 per share in the previous year, with an annualized dividend of $2.68 [2]. - The company expects to achieve the upper half of its 2025 financial guidance, projecting net income between $254 million and $261 million, and earnings per diluted share of $4.20 to $4.32 [8]. Capital Expenditures and Investments - Capital expenditures for Q1 2025 were $177.7 million, slightly down from $179.4 million in the same period last year, focusing on system integrity and service extension [4]. - Capital investments for 2025 are anticipated to be approximately $750 million, primarily for system integrity and replacement projects [9]. - Capital expenditures and asset removal costs totaled $177.7 million for the first quarter of 2025, slightly down from $179.4 million in the same period last year [33]. Customer Growth and Weather Impact - The average number of residential customers increased to 2,125,000, compared to 2,110,000 in the prior year, reflecting a growth of approximately 0.7% [33]. - The company reported a 5% colder than normal weather impact on operating income, which was mitigated by regulatory weather normalization mechanisms [2]. Assets and Equity - Total current assets decreased to $756.2 million as of March 31, 2025, down from $929.9 million at the end of 2024, a decline of about 18.6% [24]. - Total assets decreased to $8,327.2 million as of March 31, 2025, compared to $8,425.6 million at the end of 2024, a reduction of approximately 1.2% [24]. - Total equity increased to $3,185.0 million as of March 31, 2025, up from $3,104.5 million at the end of 2024, representing a growth of about 2.6% [24]. Regulatory Filings - Kansas Gas Service has requested a $7.2 million increase related to its Gas System Reliability Surcharge, with a decision expected by August 2025 [5]. - Oklahoma Natural Gas filed for a $41.5 million increase in its Performance-Based Rate Change application, reflecting net customer growth in Oklahoma and Texas [6]. Cash Flow - Cash provided by operating activities for the three months ended March 31, 2025, was $277.5 million, significantly higher than $108.3 million in the same period last year [26].

Core Insights - ONE Gas, Inc. reported strong financial results for the first quarter of 2025, with expectations to achieve the upper half of its previously announced financial guidance for the year [1][10] - The company declared a quarterly dividend of $0.67 per share, reflecting a commitment to returning value to shareholders [9] Financial Performance - Operating income for Q1 2025 was $180.5 million, up from $145.9 million in Q1 2024, driven by effective regulatory strategies and disciplined expense management [3][30] - Net income for the first quarter was $119.4 million, or $1.98 per diluted share, compared to $99.3 million, or $1.75 per diluted share, in the same period last year [9][20] - Total revenues increased to $935.2 million in Q1 2025 from $758.3 million in Q1 2024, with natural gas sales contributing significantly to this growth [30] Capital Expenditures and Investments - Capital expenditures and asset removal costs for Q1 2025 were $177.7 million, slightly down from $179.4 million in the same period last year, focusing on system integrity and service extension [4][30] - The company anticipates total capital investments of approximately $750 million for 2025, primarily for system integrity and replacement projects [10] Regulatory Activities - Kansas Gas Service submitted a request for a $7.2 million increase related to its Gas System Reliability Surcharge, with a decision expected by August 2025 [5] - Oklahoma Natural Gas filed for a $41.5 million base rate revenue increase, with a hearing scheduled for June 12, 2025 [6] Customer Metrics - The average number of customers increased to 2.305 million in Q1 2025, up from 2.290 million in Q1 2024, indicating growth in customer base across service areas [30][31] - The company experienced colder weather conditions, with actual degree days being 5% colder than normal, which positively impacted natural gas demand [9][31]

Group 1 - Spire (SR) and ONE Gas (OGS) are being considered as potential undervalued stocks in the Utility - Gas Distribution sector [1] - The Zacks Rank system indicates that SR has a rank of 2 (Buy) while OGS has a rank of 3 (Hold), suggesting a more favorable outlook for SR [3] - Value investors analyze various metrics to determine if a company is undervalued, including P/E ratio, P/S ratio, earnings yield, and cash flow per share [4] Group 2 - SR has a forward P/E ratio of 17.01, while OGS has a forward P/E of 18.45, indicating that SR may be more attractively priced [5] - The PEG ratio for SR is 2.60, compared to OGS's PEG ratio of 3.32, suggesting SR has a better earnings growth outlook relative to its price [5] - SR's P/B ratio is 1.37, while OGS's P/B ratio is 1.43, further supporting SR's stronger valuation metrics [6] Group 3 - SR's improving earnings outlook is a significant factor in its favorable Zacks Rank, making it a potentially superior value option compared to OGS [7]