manager†). The CLO will have a 4.6-year reinvestment period and a 15-year legal final. The ratings reflect initial cre...## KBRA Releases Research – Home Improvement ABS: Promotional Products, Delayed LossesNEW YORK--([BUSINESS WIRE])--KBRA releases research examining the credit characteristics and loss profiles of securitized home improvement (HI) loans by product type (promotional versus traditional) and provides an update on ABS issuance trends and credit performance. Home improvement ABS is a subsecto ...

Financial Data and Key Metrics Changes - The company reported adjusted earnings of $1.77 per share for Q1 2026, an increase from $1.34 per share a year ago, reflecting strong execution in the gas utility business and contributions from marketing and midstream segments [4][10] - Adjusted earnings for the quarter totaled $108 million, compared to $81 million in the previous year, indicating a year-over-year growth of approximately 33% in gas utilities earnings [10][11] - The company reaffirmed its 2026 adjusted EPS guidance of $5.25 to $5.45 per share and 2027 guidance of $5.65 to $5.85 per share, with a long-term adjusted EPS growth target of 5% to 7% [6][12] Business Line Data and Key Metrics Changes - Gas utilities earned $104 million, up over 33% from the previous year, driven by new rates in Missouri and higher margins in Alabama [10] - Gas marketing segment earnings increased to $4.5 million, up $2.3 million due to enhanced portfolio optimization opportunities [11] - Midstream earnings rose to $12.7 million, an increase of nearly $1 million from last year, attributed to additional capacity at Spire Storage [11] Market Data and Key Metrics Changes - The company experienced record natural gas demand during Winter Storm Fern, delivering natural gas equivalent to 31 gigawatts of electric generation capacity [3] - The new Missouri rates became effective in October, and a request for a $30.3 million revenue increase was filed in November, expected to be effective by May [5] Company Strategy and Development Direction - The company is focused on executing its ten-year capital plan of $11.2 billion, primarily targeting utility investments, and maintaining a disciplined approach to capital deployment [6][9] - The company is committed to customer affordability through cost management and is pursuing constructive regulatory outcomes across all jurisdictions [4][15] - The integration planning for the Tennessee acquisition is underway, with an 18-month transition services agreement to ensure continuity for customers and employees [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the portfolio and the ability to achieve long-term growth targets despite the challenges posed by extreme weather conditions [4][6] - The company is focused on simplifying its portfolio and expects to provide updates on the potential sale of natural gas storage assets later this quarter [8][25] - Management highlighted the importance of maintaining a strong balance sheet and flexibility, targeting a funds from operations (FFO) to debt ratio of 15%-16% [14] Other Important Information - The merger of the STL and MoGas pipelines was completed on January 1, 2026, and will operate as the Spire MoGas pipeline [13] - The company invested $230 million in capital expenditures during the quarter, primarily directed toward gas utility operations [8][9] Q&A Session Summary Question: How did the marketing segment perform during January's gas market volatility? - Management indicated that the marketing segment performed well and met all customer obligations during the volatility, with a positive outlook for further discussions in the next quarter [17][18] Question: Can you provide an update on the storage asset sales process? - Management confirmed strong interest in the storage assets and is focused on achieving the right value, with an announcement expected later this quarter [24][25] Question: What are the expectations for equity issuance related to the Tennessee acquisition? - Management indicated that announcements regarding equity issuance would likely occur after the next call in May or June, depending on the progress of the acquisition [31] Question: What is the regulatory strategy and timeline for the next rate case in Missouri? - Management anticipates filing the next rate case after the fiscal year-end but before Thanksgiving, with preparations already underway [55]

Financial Data and Key Metrics Changes - The company reported adjusted earnings of $1.77 per share for Q1 2026, an increase from $1.34 per share a year ago, reflecting strong execution in the gas utility business and contributions from marketing and midstream segments [4][10] - Adjusted earnings for the quarter totaled $108 million, compared to $81 million in the previous year, marking a year-over-year increase of approximately 33% in gas utilities earnings [10][11] - The company reaffirmed its 2026 adjusted EPS guidance of $5.25-$5.45 per share and 2027 guidance of $5.65-$5.85 per share, indicating confidence in long-term growth [6][12] Business Line Data and Key Metrics Changes - Gas utilities earned $104 million, up over 33% from the previous year, driven by new rates in Missouri and higher margins in Alabama [10][11] - Gas marketing segment earnings increased to $4.5 million, up $2.3 million due to enhanced portfolio optimization opportunities [10] - Midstream earnings rose to $12.7 million, an increase of nearly $1 million from last year, attributed to additional capacity at Spire Storage [11] Market Data and Key Metrics Changes - The company experienced record natural gas demand during Winter Storm Fern, delivering natural gas equivalent to 31 gigawatts of electric generation capacity [3] - The company’s capital expenditures for the quarter were $230 million, primarily directed towards gas utility operations, with expectations of $809 million in total CapEx for 2026 [8][9] Company Strategy and Development Direction - The company is focused on executing its ten-year capital plan of $11.2 billion, with a majority aimed at utility investments [7] - The company is committed to maintaining customer affordability through disciplined cost management and achieving constructive regulatory outcomes [4][15] - The ongoing evaluation of potential sales of natural gas storage assets aims to simplify the portfolio while ensuring the right value is achieved [8][25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the portfolio and the disciplined approach to capital deployment, reaffirming long-term adjusted EPS growth targets of 5%-7% [6][12] - The integration planning for the Tennessee acquisition is underway, with a focus on ensuring seamless continuity for customers and employees [8][40] - Management highlighted the importance of maintaining a strong balance sheet and flexibility, targeting a funds from operations to debt ratio of 15%-16% [14] Other Important Information - The company completed the merger of the STL and MoGas pipelines, which will now operate as the Spire MoGas pipeline [13] - The company anticipates minimal common equity needs and plans to rely on long-term debt for refinancing and capital requirements [14] Q&A Session Summary Question: How did the marketing segment perform during January's gas market volatility? - Management indicated satisfaction with the operational performance and confirmed that customer obligations were met during the volatility [17][18] Question: Can you provide an update on the storage asset sales process? - Management noted that the evaluation process is taking longer than expected but remains optimistic about achieving good value for the assets [24][25] Question: What are the opportunities for large loads or generation facilities in service territories? - Management is actively engaging with parties regarding opportunities to serve generation needs as they convert from coal to gas [27] Question: What is the timeline for equity issuance related to the Tennessee acquisition? - Management indicated that announcements regarding equity issuance would likely occur after the next earnings call in May or June [31] Question: What is the regulatory strategy and timeline for the next rate case in Missouri? - Management anticipates filing the next rate case in October-November 2026, following the pattern of previous cases [55]

Financial Data and Key Metrics Changes - The company reported adjusted earnings of $1.77 per share for Q1 fiscal 2026, an increase from $1.34 per share a year ago, reflecting strong execution in the gas utility business and contributions from marketing and midstream segments [4][10] - Adjusted earnings for the quarter totaled $108 million, compared to $81 million in the previous year, with gas utilities earning $104 million, up over 33% [10][11] - The company reaffirmed its 2026 adjusted EPS guidance of $5.25-$5.45 per share and 2027 guidance of $5.65-$5.85 per share, indicating confidence in its financial performance [5][12] Business Line Data and Key Metrics Changes - Gas utilities segment earnings increased by $26 million year-over-year, driven by new rates in Missouri and higher margins in Alabama, despite lower volumetric margins and increased O&M depreciation and interest expenses [10][11] - Gas marketing segment earnings rose to $4.5 million, an increase of $2.3 million due to enhanced portfolio optimization opportunities [10] - Midstream segment earnings reached $12.7 million, up nearly $1 million from the previous year, attributed to additional capacity at Spire Storage [11] Market Data and Key Metrics Changes - The company experienced significant demand for natural gas during Winter Storm Fern, delivering natural gas equivalent to 31 gigawatts of electric generation capacity [3] - The company’s capital expenditures for the quarter were $230 million, primarily directed towards gas utility operations, with expectations of $809 million in CapEx for 2026 [8][9] Company Strategy and Development Direction - The company is focused on executing its ten-year capital plan of $11.2 billion, primarily targeting utility investments, while maintaining a disciplined approach to capital deployment [6][9] - The company aims to achieve constructive regulatory outcomes and is preparing for a future test year Missouri rate case [16] - The ongoing evaluation of the potential sale of natural gas storage assets reflects the company's strategy to simplify its portfolio [8][26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the portfolio and the disciplined approach to capital deployment, reaffirming long-term adjusted EPS growth targets of 5%-7% [5][12] - The integration planning for the Tennessee acquisition is underway, with a focus on ensuring seamless continuity for customers and employees [8][39] - Management highlighted the importance of customer affordability and cost management as central to the company's strategy [4][16] Other Important Information - The company issued $900 million of junior subordinated notes and entered into a master note purchase agreement for $825 million of senior notes to fund the Tennessee acquisition [7][15] - The merger of the STL and MoGas pipelines was completed on January 1, 2026, which will operate as the Spire MoGas pipeline [13] Q&A Session Summary Question: How did the marketing segment perform during the gas market volatility in January? - Management indicated satisfaction with the operational performance and confirmed that customer obligations were met during the volatility [18][19] Question: Can you provide an update on the storage asset sales process? - Management noted that the evaluation process is taking longer than expected but remains optimistic about achieving the right value for the assets [24][25][46] Question: What are the expectations for equity issuance related to the Tennessee acquisition? - Management stated that an announcement regarding the storage evaluation is expected later this quarter, and they are covered with a bridge loan if needed [32][26] Question: What is the regulatory strategy and timeline for Missouri? - Management anticipates filing the next rate case after the fiscal year-end, likely in the October-November timeframe [56]

Financial Performance - Operating revenues for the three months ended December 31, 2025, increased to $762.2 million, up from $669.1 million in the same period of 2024, representing a growth of 13.3%[9] - Net income for the same period rose to $95.0 million, compared to $81.3 million in 2024, reflecting an increase of 16.5%[11] - Basic earnings per common share increased to $1.55 for the three months ended December 31, 2025, compared to $1.34 in 2024, marking a growth of 15.7%[9] - The company reported a comprehensive income of $77.2 million for the three months ended December 31, 2025, compared to $53.5 million in 2024, indicating a significant increase of 44.4%[25] - Adjusted earnings for the three months ended December 31, 2025, were $108.4 million, compared to $81.1 million for the same period in 2024, reflecting a year-over-year increase of 33.7%[124] - The company reported a net income of $103.9 million for the three months ended December 31, 2025, compared to $77.8 million for the same period in 2024, representing a year-over-year increase of 33.8%[176] Assets and Liabilities - Total assets as of December 31, 2025, reached $11,881.9 million, an increase from $11,275.8 million as of December 31, 2024, indicating a growth of 5.4%[16] - Long-term debt (less current portion) increased to $4,449.4 million as of December 31, 2025, compared to $3,697.7 million in the previous year, reflecting a rise of 20.3%[16] - Total shareholders' equity as of December 31, 2025, was $3,432.7 million, up from $3,308.9 million in 2024, representing an increase of 3.8%[16] - Total assets for Spire Missouri Inc. rose to $6,550.8 million as of December 31, 2025, up from $6,349.8 million as of September 30, 2025[30] - Total regulatory assets as of December 31, 2025, amounted to $1,394.8 million, slightly down from $1,401.8 million as of September 30, 2025[70] - Total liabilities for gas utility contracts were $35.3 million, with $19.9 million related to natural gas commodity contracts[102] Cash Flow and Investments - Cash and cash equivalents decreased to $4.1 million as of December 31, 2025, down from $11.5 million in the previous year, a decline of 64.3%[14] - Cash provided by operating activities was $81.0 million for the three months ended December 31, 2025, slightly down from $81.1 million in 2024[22] - The net cash used in investing activities was $201.3 million for the three months ended December 31, 2025, compared to $260.1 million in 2024, indicating a reduction in investment outflows[22] - The company reported a net decrease in cash and cash equivalents of $1.9 million for the three months ended December 31, 2025[48] Capital Expenditures - Capital expenditures for the three months ended December 31, 2025, were $202.8 million, a decrease from $260.6 million in the same period of 2024[22] - Capital expenditures for Spire Alabama increased to $41.3 million in Q4 2025 from $34.5 million in Q4 2024, showing an increase of about 19.6%[118] - Capital expenditures for Spire Missouri were $148.0 million in Q4 2025, down from $178.3 million in Q4 2024, indicating a decrease of about 16.9%[116] Debt and Financing - The company has a commercial paper program allowing for short-term borrowings up to $1,500.0 million, with $224.1 million utilized to support lending to the Utilities as of December 31, 2025[82][83] - The weighted average interest rate for borrowings outstanding as of December 31, 2025, was 3.9% across Spire, Spire Missouri, and Spire Alabama[84] - Spire issued $900.0 million of junior subordinated notes on November 24, 2025, with interest rates of 6.250% and 6.450% for Series A and Series B, respectively[87][88] - The company has committed to a total of $1,738.5 million in minimum payments under contracts for the storage, transportation, and supply of natural gas, expiring through calendar 2039[125] Regulatory and Rate Changes - Spire Missouri filed a PGA adjustment increase effective November 26, 2025, reflecting changes in natural gas commodity prices[73] - The company received approval for a base rate increase of $210.0, effective October 24, 2025, resulting in a net base rate increase of $137.4 after accounting for the $72.6 already collected through the Infrastructure System Replacement Surcharge (ISRS)[74] - Spire Alabama's annual Rate Stabilization and Equalization (RSE) filing resulted in an annual revenue increase of $12.9 million, effective December 1, 2025[77] Acquisitions and Strategic Initiatives - Spire entered into an agreement to acquire Piedmont Natural Gas's Tennessee business for $2.48 billion in cash, subject to customary adjustments[146] - The acquisition is expected to significantly increase Spire's scale in a fast-growing region, expand regulatory diversity, and support dividend growth[150] - Spire has a committed senior unsecured bridge facility of up to $725.0 million to fund the acquisition, which includes a $125.0 million bridge term loan and a $600.0 million delayed draw term loan[147] Segment Performance - Revenue from the Gas Utility segment increased to $693.3 million in 2025, compared to $613.5 million in 2024, reflecting a growth of 13.0%[62] - Gas Utility net income for the quarter ended December 31, 2025, increased by $26.1 million compared to the prior year, driven by improved performance from Spire Missouri and Spire Alabama[184] - Operating revenues for Gas Utility rose to $79.8 million, primarily due to the $46.4 million impact from the Missouri rate case implementation and an $11.0 million increase in volumetric usage in Spire Alabama[185] Miscellaneous - The company is involved in ongoing environmental remediation activities, with costs incurred to date not being material, but future costs could be significant depending on various factors[130] - The company recorded unrealized gains or losses from mutual funds and bonds in the income statement, impacting overall financial performance[101] - The company is actively pursuing new strategies for market expansion and product development in the gas utility sector[104]

Core Insights - Spire Inc. reported first-quarter fiscal 2026 adjusted earnings of $1.77 per share, exceeding the Zacks Consensus Estimate of $1.62 by 9.3% and reflecting a 32.1% increase from $1.34 in the same quarter last year [1][8] Revenue Performance - Total revenues for the quarter reached $762.2 million, surpassing the Zacks Consensus Estimate of $712 million by 7.1% and showing a 13.9% increase from $669.1 million in the prior-year quarter [2][8] Earnings Highlights - Operating expenses were $588.7 million, up 13.1% from $520.3 million in the previous year [3] - Operating income was reported at $173.5 million, compared to $148.8 million in the prior-year quarter [3] - Net interest expenses rose 25.8% year over year to $60.4 million [3] Segment Performance - Gas Utility segment reported adjusted earnings of $103.9 million, a 33.7% increase from the prior-year quarter, driven by stronger results in Spire Missouri and Spire Alabama [4][8] - Gas Marketing segment saw adjusted earnings of $4.5 million, a significant growth of 104.5% year over year due to better portfolio optimization [4] - Midstream segment adjusted earnings totaled $12.7 million, up 5.8% from the previous year, attributed to higher Spire Storage revenues [5] - Other segment reported an adjusted loss of $12.7 million, compared to a loss of $10.9 million in the prior-year quarter [5] Financial Position - Cash and cash equivalents as of December 31, 2025, were $4.1 million, down from $5.7 million as of September 30, 2025 [6] - Long-term debt as of December 31, 2025, totaled $4.45 billion, an increase from $3.37 billion as of September 30, 2025 [6][8] - Net cash from operating activities for the first three months of fiscal 2026 was $81 million, slightly down from $81.1 million in the same period last year [6] Guidance - Spire expects fiscal 2026 adjusted earnings to be in the range of $5.25-$5.45 per share, with the Zacks Consensus Estimate at $5.30 [9] - For fiscal 2027, adjusted earnings are expected to be in the range of $5.65-$5.85 per share, with the Zacks Consensus Estimate at $5.71 [9] - The company plans a 10-year capital investment of $11.2 billion through fiscal 2035, aiming for long-term adjusted earnings per share growth of 5-7% [10]

First quarter fiscal 2026 update February 3, 2026 Forward-looking statements and use of non-GAAP measures This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Our forward-looking statements in this presentation speak only as of today, and we assume no duty to update them. Forward- looking statements are typically identified by words such as, but not limited to: "estimates," "expects," "anticipates," "intends," "targets," "plans," " ...

Core Insights - Spire reported quarterly earnings of $1.77 per share, exceeding the Zacks Consensus Estimate of $1.62 per share, and showing an increase from $1.34 per share a year ago, resulting in an earnings surprise of +9.43% [1] - The company achieved revenues of $762.2 million for the quarter ended December 2025, surpassing the Zacks Consensus Estimate by 7.00%, compared to $669.1 million in the same quarter last year [2] Earnings Performance - Over the last four quarters, Spire has surpassed consensus EPS estimates two times and topped consensus revenue estimates three times [2] - The current consensus EPS estimate for the upcoming quarter is $3.78 on revenues of $1.04 billion, and for the current fiscal year, it is $5.30 on revenues of $2.47 billion [7] Market Position - Spire shares have increased by approximately 3.2% since the beginning of the year, outperforming the S&P 500's gain of 1.9% [3] - The Zacks Industry Rank for Utility - Gas Distribution is currently in the bottom 30% of over 250 Zacks industries, indicating potential challenges for the sector [8] Future Outlook - The sustainability of Spire's stock price movement will depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] - The estimate revisions trend for Spire was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, suggesting it is expected to perform in line with the market in the near future [6]

Financial Performance - For the first quarter of fiscal 2026, Spire reported net income of $95.0 million, or $1.54 per diluted share, compared to $81.3 million, or $1.34 per share, in the prior year, representing a year-over-year increase of 16.5% in net income [3]. - Adjusted earnings for the first quarter were $108.4 million, or $1.77 per share, an increase of $0.43 compared to $81.1 million, or $1.34 per share, in the previous year [3]. - Total operating revenues for the first quarter were $762.2 million, up from $669.1 million in the prior year, reflecting a 13.9% increase [21]. - Operating income increased to $173.5 million from $148.8 million, marking a 16.6% rise year-over-year [21]. - Net income for the three months ended December 31, 2025, was $95.0 million, compared to $81.3 million for the same period in 2024, reflecting a year-over-year increase of 16.5% [23]. - Adjusted earnings for the three months ended December 31, 2025, were $108.4 million, up from $81.1 million in 2024, marking a significant increase of 33.6% [24]. - Operating Revenues for the three months ended December 31, 2025, were $762.2 million, an increase from $669.1 million in the same period of 2024, representing a year-over-year growth of approximately 13.9% [26]. - Contribution Margin (Non-GAAP) for Q4 2025 was $419.6 million, up from $372.3 million in Q4 2024, indicating a growth of about 12.7% [26]. - Operating Income (GAAP) for Q4 2025 was $173.5 million, compared to $148.8 million in Q4 2024, reflecting an increase of approximately 16.6% [26]. Segment Performance - The Gas Utility segment's adjusted earnings increased to $103.9 million from $77.8 million, driven by higher earnings at Spire Missouri and Spire Alabama [5]. - Contribution margin rose by $48.0 million, primarily due to new rates in Spire Missouri and increased revenues from the Infrastructure System Replacement Surcharge (ISRS) [6]. - The company reported a contribution margin of $380.2 million from utility operations in Q4 2025, compared to $332.2 million in Q4 2024, indicating a growth of approximately 14.5% [26]. Guidance and Future Plans - The company affirmed its fiscal 2026 adjusted earnings guidance range of $5.25–$5.45 per share and fiscal 2027 guidance of $5.65–$5.85 per share [3]. - The company plans a 10-year capital investment target of $11.2 billion through fiscal 2035, focusing on infrastructure and new business in the Gas Utility segment [15]. Debt and Assets - Long-term debt (less current portion) rose to $4,449.4 million in September 2025, compared to $3,369.4 million in December 2024, indicating an increase of 32.0% [22]. - Total assets increased to $11,881.9 million in September 2025, up from $11,575.3 million in December 2024, representing a growth of 2.6% [22]. - The company issued $1,100.0 million in long-term debt during the financing activities for the three months ended December 31, 2025 [23]. Cash Flow and Expenses - Cash provided by operating activities was $81.0 million for the three months ended December 31, 2025, slightly down from $81.1 million in 2024 [23]. - Capital expenditures for the three months ended December 31, 2025, were $202.8 million, down from $260.6 million in 2024, a decrease of 22.1% [23]. - Total current liabilities decreased to $1,713.3 million in September 2025 from $2,548.6 million in December 2024, a reduction of 32.7% [22]. - Retained earnings increased to $1,127.7 million in September 2025, compared to $1,087.6 million in December 2024, reflecting a growth of 3.7% [22]. - The cash balance at the end of the period was $39.9 million, down from $41.9 million at the end of December 2024, a decrease of 4.8% [23]. Operating Expenses - Natural gas costs for Q4 2025 totaled $312.7 million, which is higher than $270.0 million in Q4 2024, marking an increase of about 15.9% [26]. - Operation and maintenance expenses for Q4 2025 were $139.9 million, slightly up from $129.3 million in Q4 2024, showing an increase of approximately 8.1% [26]. - Depreciation and amortization expenses rose to $81.4 million in Q4 2025 from $72.3 million in Q4 2024, representing an increase of about 12.6% [26]. - Taxes, other than income taxes, were $54.7 million in Q4 2025, compared to $48.7 million in Q4 2024, indicating a year-over-year increase of approximately 18.9% [26]. - Gross receipts tax expense for Q4 2025 was $29.9 million, up from $26.8 million in Q4 2024, reflecting an increase of about 11.6% [26]. Other Activities - Adjusted loss from other activities was $12.7 million, compared to a loss of $10.9 million in the prior year, primarily due to higher corporate costs and interest expense [11]. - The operating income from marketing operations in Q4 2025 was a loss of $3.9 million, an improvement from a loss of $2.7 million in Q4 2024, showing a reduction in losses [26].

Core Viewpoint - Spire Inc. has announced the redemption of all outstanding Series A Cumulative Redeemable Perpetual Preferred Stock, with a redemption date set for February 13, 2026, at a price of $25.00 per Depositary Share plus accrued dividends [1][2]. Group 1: Redemption Details - The redemption price consists of the Base Redemption Amount of $25.00 per Depositary Share and all accrued and unpaid dividends up to the Redemption Date [2]. - The Company will redeem the Depositary Shares on the Redemption Date, with payment made only to holders of the Series A Preferred Stock as of that date [4]. - On February 17, 2026, holders of record as of January 26, 2026, will receive a declared dividend of $0.36875 per Depositary Share, which includes all accrued dividends [3][4]. Group 2: Company Overview - Spire Inc. serves approximately 1.7 million homes and businesses, making it one of the largest publicly traded natural gas companies in the United States [7]. - The Company operates gas utilities in Alabama, Mississippi, and Missouri, and is involved in natural gas-related businesses such as Spire Marketing and Spire Midstream [7]. - Spire is focused on organic growth, infrastructure investment, and continuous improvement to transform its business [7].