SOURCE Southwest Gas Holdings, Inc. WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM? 440k+Newsrooms &Influencers 9k+Digital MediaOutlets 270k+JournalistsOpted In GET STARTED Also from this source Southwest Gas Holdings Announces Release of 2024 Sustainability Report Accessibility StatementSkip Navigation Company to Host Earnings Conference Call on November 5, 2025 LAS VEGAS, Oct. 22, 2025 /PRNewswire/ -- Southwest Gas Holdings, Inc. (NYSE: SWX) ("Southwest Gas Holdings" or the "Company") will hold it ...

Company highlights safety advances, renewable energy investments, and emissions reduction efforts The Company's ESG activities and performance are overseen by the Nominating and Corporate Governance Committee of the Board of Directors as well as leadership from Southwest Gas, ensuring ESG practices are adopted throughout the Company. The complete report is available here: www.swgasholdings.com/esg About Southwest Gas Holdings, Inc. Southwest Gas Holdings, Inc., through its primary operating subsidiary Sout ...

Group 1 - The Board of Directors for Southwest Gas Holdings, Inc. has declared a fourth quarter cash dividend of $0.62 per share, payable on December 1, 2025, with a record date of November 17, 2025 [1] - The annualized dividend equates to $2.48 per share, and the company has consistently paid quarterly dividends since going public in 1956 [1] Group 2 - Southwest Gas Holdings, Inc. is based in Las Vegas, Nevada, and operates through its primary subsidiary, Southwest Gas Corporation, which focuses on purchasing, distributing, and transporting natural gas [3] - The company serves over 2 million residential, commercial, and industrial customers across Arizona, Nevada, and California, emphasizing safe and reliable service while innovating sustainable energy solutions [3]

Core Viewpoint - Southwest Gas Holdings has successfully completed the public offering of Centuri Holdings, selling 27,362,210 shares at $19.60 per share, resulting in net proceeds of approximately $525 million, and has exited its investment in Centuri [1][2][3]. Group 1: Financial Impact - The company received net proceeds of approximately $525 million from the offering after deducting underwriter's discounts and commissions [2]. - Following the offering, Southwest Gas Holdings has no remaining shares of Centuri's common stock [2]. Group 2: Strategic Transformation - The exit from Centuri positions Southwest Gas Holdings as a fully regulated natural gas company, enhancing transparency and aligning with long-term value creation in the utility sector [3]. - The company has fully repaid all holding company debt, including a term loan, and has about $600 million in cash on hand, providing significant financial flexibility for future capital investments [3]. Group 3: Future Plans - The resources from the offering are expected to primarily support future capital investments at Southwest Gas Corporation, including a potential expansion of Great Basin Gas Transmission Company in 2028 [3].

Financial Data and Key Metrics Changes - The trailing twelve-month return on equity (ROE) increased to 8.3% from 8% in the previous two years [7] - Full year net income guidance is reaffirmed at $265 million to $275 million [9][40] - The utility reported record net income for 2025 with modest increases in operating and maintenance (O&M) expenses compared to the previous year [9] Business Line Data and Key Metrics Changes - The utility segment saw higher margins supported by rate relief and continued customer growth, with a $26.6 million increase in utility operating margin [28][30] - O&M expenses increased by $7 million, primarily due to higher labor and benefit costs [31] - Other income increased by $3.6 million, driven by gains from COLI policies and a one-time nonoperating gain [32] Market Data and Key Metrics Changes - Approximately 40,000 new meter sets were added over the last twelve months, indicating robust growth in the utility's service area [14][26] - The Great Basin expansion project received significant interest, with potential capacity requests estimated at 1.76 billion cubic feet per day [15][17] Company Strategy and Development Direction - The company aims to position itself as a premier pure play, fully regulated natural gas business, focusing on operational and financial performance improvements [6] - The regulatory strategy includes pursuing alternative ratemaking in Nevada, which is expected to reduce regulatory lag and support price stability [7][22] - The company plans to invest approximately $4.3 billion over the next five years to support safety, reliability, and economic development [26][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the regulatory strategy and the positive economic outlook in service areas, which supports growth [40] - The company is optimistic about the impacts of the new legislation in Nevada and the completion of the Arizona rate case [20][21] - Management highlighted the importance of maintaining a strong balance sheet to support capital investments and stockholder value [13][38] Other Important Information - The company successfully executed two secondary public offerings of Century shares, generating over $470 million in net proceeds used to repay debt [10][34] - The company no longer expects to issue new equity under its ATM program in 2025 [13][35] - The balance sheet remains strong, with over $350 million in cash and more than $1 billion in liquidity [14][38] Q&A Session Summary Question: Clarification on Great Basin expansion and return profile - Management confirmed that the increase in the project cost range is purely volume-driven from additional shipper requests for capacity [45][46] Question: Timeline for Nevada rate case and alternative rate making - Management indicated that the Nevada rate case and the new legislation could work complementarily, and they do not see an advantage in delaying the next rate case [50][51] Question: Duration and cadence of Arizona rate case - Management is evaluating the timing of the next Arizona rate case and the potential for formula rates, considering ongoing rate cases in the state [60][61] Question: Clarification on COLI gains and interest savings - Management confirmed that the COLI gains contributed positively to the corporate segment, and interest savings from debt repayment will continue to benefit the company [64][65] Question: Confidence in Great Basin project and CPCN filing - Management expressed confidence in proceeding with the CPCN filing once sufficient precedent agreements are signed, indicating strong project viability [68][70]

Financial Data and Key Metrics Changes - The company reported a trailing twelve-month return on equity (ROE) of 8.3%, an increase from 8% in the previous two years [8] - Full year net income guidance remains between $265 million to $275 million [9] - The utility reported record net income for 2025 with modest increases in operating and maintenance (O&M) expenses compared to the previous year [9][30] Business Line Data and Key Metrics Changes - The utility segment saw higher margins supported by rate relief and continued customer growth, with utility operating margin increasing by $26.6 million [29][31] - O&M expenses increased by $7 million year-over-year, primarily due to higher labor and benefit costs [32] - Other income increased by $3.6 million, driven by gains from COLI policies and a one-time nonoperating gain from an asset sale [33] Market Data and Key Metrics Changes - The company added approximately 40,000 new meter sets over the last twelve months, indicating robust growth driven by strong economic activity in its service area [14][27] - The Great Basin expansion project received significant interest, with potential shippers requesting approximately 1.76 billion cubic feet of capacity per day [16][18] Company Strategy and Development Direction - The company aims to position itself as a premier pure play, fully regulated natural gas business, focusing on operational and financial performance improvements [7] - The regulatory strategy includes pursuing alternative ratemaking in Nevada, which is expected to reduce regulatory lag and support price stability [8][11] - The company plans to invest approximately $4.3 billion over the next five years to support safety, reliability, and economic development across its service territories [27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the regulatory strategy and the completion of the Arizona rate case, which is expected to positively impact future earnings [41] - The company anticipates that the regulatory cycle will result in nonlinear net income growth, with a focus on maintaining flat O&M per customer trends [41][42] - Management highlighted the importance of customer service and executing strategic priorities while delivering strong financial results [43] Other Important Information - The company successfully executed two secondary public offerings of Century shares, generating over $470 million in net proceeds, which were used to repay debt [10][34] - The company has no plans to issue new equity in 2025 following the Century sell-downs [13][36] Q&A Session Summary Question: Can you provide more granularity on the Great Basin expansion? - Management confirmed that the increase in the project cost range is purely volume-driven due to additional shippers requesting incremental capacity [46][47] Question: How should we think about the return profile of the Great Basin investment? - Management indicated that the return profile would be based on the FERC authorized rate of return and that AFUDC would apply to the project [48][51] Question: Will you consider delaying a traditional rate case filing in Nevada to help accelerate formula rates? - Management stated that they do not see an advantage in delaying the next rate case, as both processes can work complementarily [52][53] Question: How long do you think the Nevada Commission will take to sort out the SB 417 process? - Management anticipates that the rulemaking process could be completed within the next twelve months [58][60] Question: What are your thoughts on the cadence and duration of the Arizona rate case? - Management is evaluating whether to accelerate the timing of the next Arizona rate case, considering the preference for formula rates expressed by the commission [61][62] Question: Can we infer that you feel comfortable with the level of agreements signed for the Great Basin project if you make the CPCN filing? - Management confirmed that the CPCN filing would indicate confidence in the agreements signed to date [69][73]

Financial Performance & Strategic Focus - Southwest Gas Holdings (SWX) reported Q2 2025 net income of approximately $34 million, a 22% increase compared to Q2 2024, and year-to-date net income of approximately $177 million, an 8.1% increase compared to the same period in 2024[26] - SWX is committed to a pure-play, fully regulated natural gas business strategy through the disposition of its remaining interest in Centuri[22] - SWX expects 2025 Utility net income to fall within the $265 - $275 million guidance range[22] - The company is targeting 6% to 8% net income growth and 6% to 8% rate base growth from 2025-2029[22] Centuri Separation & Financing - Secondary offerings in Q2 2025 reduced SWX ownership in Centuri to approximately 52.1%[23] - Net proceeds of approximately $470 million from the Centuri secondary offerings were used to repay debt and strengthen the balance sheet[23] - SWX no longer expects to issue equity in 2025 due to proceeds from Centuri follow-on offerings[70] Regulatory & Operational Updates - Approximately 40,000 new meter sets were added during the last 12 months, leading to a 1.8% customer growth rate[26] - The company received approval to accelerate the return to Nevada customers of over-collected purchased gas costs, beginning July 1, 2025[26] - Great Basin successfully completed its binding open season, identifying potential incremental capacity of up to 1.76 billion cubic feet (Bcf)/day[26] - The potential incremental capital expenditure opportunity for the Great Basin expansion is approximately $1.2 - $1.6 billion[36]

Company Performance - Southwest Gas reported quarterly earnings of $0.53 per share, exceeding the Zacks Consensus Estimate of $0.42 per share, and up from $0.31 per share a year ago, representing an earnings surprise of +26.19% [1] - The company posted revenues of $1.12 billion for the quarter ended June 2025, which missed the Zacks Consensus Estimate by 7.3%, and compared to year-ago revenues of $1.18 billion [2] - Over the last four quarters, Southwest Gas has surpassed consensus EPS estimates four times but has not beaten consensus revenue estimates [2] Stock Performance - Southwest Gas shares have increased approximately 12.5% since the beginning of the year, outperforming the S&P 500's gain of 7.1% [3] - The current status of estimate revisions for Southwest Gas translates into a Zacks Rank 3 (Hold), indicating that shares are expected to perform in line with the market in the near future [6] Future Outlook - The current consensus EPS estimate for the coming quarter is $0.08 on $1.12 billion in revenues, and for the current fiscal year, it is $3.73 on $4.84 billion in revenues [7] - The outlook for the Utility - Gas Distribution industry is positive, currently ranking in the top 25% of over 250 Zacks industries, suggesting that the top 50% of Zacks-ranked industries outperform the bottom 50% by more than 2 to 1 [8] Industry Comparison - Chesapeake Utilities, another company in the same industry, is expected to report quarterly earnings of $1.00 per share, reflecting a year-over-year change of +16.3%, with revenues anticipated to be $185.4 million, up 11.5% from the year-ago quarter [9][10]

[Form 10-Q Filing Information](index=1&type=section&id=Form%2010-Q%20Filing%20Information) This report details the combined quarterly financial filing for Southwest Gas Holdings and its subsidiary, Southwest Gas Corporation, as of June 30, 2025 - This is a combined quarterly report (Form 10-Q) filed by Southwest Gas Holdings, Inc. and its wholly-owned subsidiary, Southwest Gas Corporation, for the period ended June 30, 2025[1](index=1&type=chunk)[3](index=3&type=chunk) - As of July 25, 2025, Southwest Gas Holdings, Inc. had **71,979,296 shares** of common stock outstanding. All outstanding common stock of Southwest Gas Corporation was held by Southwest Gas Holdings, Inc.[2](index=2&type=chunk) | Registrant | File Number | State of Incorporation | Employer Identification No. | | :-------------------------- | :---------- | :--------------------- | :-------------------------- | | Southwest Gas Holdings, Inc. | 001-37976 | Delaware | 81-3881866 | | Southwest Gas Corporation | 1-7850 | California | 88-0085720 | [Glossary of Key Terms](index=3&type=section&id=Glossary%20of%20Key%20Terms) This section provides definitions for important terms used throughout the financial report [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) This section outlines the forward-looking nature of the report's statements and identifies key risk factors that could impact actual results - The report contains forward-looking statements subject to the safe harbor protection of the Private Securities Litigation Reform Act of 1995, covering plans, objectives, goals, intentions, projections, strategies, future events, and performance[7](index=7&type=chunk)[8](index=8&type=chunk) - Important factors that could cause actual results to differ materially include customer growth rates, housing market conditions, inflation, interest rates, regulatory policies, and the ongoing Centuri separation[9](index=9&type=chunk)[10](index=10&type=chunk) [Part I - Financial Information](index=6&type=section&id=Part%20I%20-%20Financial%20Information) This part presents the comprehensive financial data, including statements and detailed notes, for both Southwest Gas Holdings and Southwest Gas Corporation [ITEM 1. Financial Statements](index=6&type=section&id=ITEM%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements for Southwest Gas Holdings, Inc. and its subsidiaries, and Southwest Gas Corporation and its subsidiaries, for the quarter and six months ended June 30, 2025, and comparative periods. It includes balance sheets, statements of income, comprehensive income, cash flows, and equity, with combined notes for both entities [Southwest Gas Holdings, Inc. and Subsidiaries](index=6&type=section&id=Southwest%20Gas%20Holdings,%20Inc.%20and%20Subsidiaries) This section presents the unaudited condensed consolidated financial statements for Southwest Gas Holdings, Inc. and its subsidiaries [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20(Holdings)) This table provides a snapshot of Southwest Gas Holdings' assets, liabilities, and equity at specific reporting dates **Southwest Gas Holdings, Inc. and Subsidiaries - Balance Sheet Highlights (Thousands of dollars):** | Item | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :------------ | :---------------- | | Total assets | $12,213,945 | $12,023,836 | | Total equity | $4,115,805 | $3,681,422 | | Long-term debt, less current maturities | $4,396,867 | $4,348,340 | | Short-term debt | $260,000 | $680,000 | [Condensed Consolidated Statements of Income](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20(Holdings)) This table details Southwest Gas Holdings' revenues, expenses, and net income over specified quarterly and year-to-date periods **Southwest Gas Holdings, Inc. and Subsidiaries - Income Statement Highlights (Thousands of dollars, except per share):** | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total operating revenues | $1,120,370 | $1,182,168 | $2,416,867 | $2,763,124 | | Operating income | $95,456 | $83,221 | $295,878 | $241,346 | | Net income (loss) attributable to SWX | $(12,883) | $18,333 | $100,987 | $106,070 | | Basic earnings (loss) per share | $(0.18) | $0.26 | $1.40 | $1.48 | [Condensed Consolidated Statements of Comprehensive Income](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Holdings)) This table presents Southwest Gas Holdings' comprehensive income, including net income and other comprehensive income items **Southwest Gas Holdings, Inc. and Subsidiaries - Comprehensive Income Highlights (Thousands of dollars):** | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Comprehensive income (loss) attributable to SWX | $(6,970) | $17,736 | $107,252 | $103,038 | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20(Holdings)) This table summarizes Southwest Gas Holdings' cash inflows and outflows from operating, investing, and financing activities **Southwest Gas Holdings, Inc. and Subsidiaries - Cash Flow Highlights (Thousands of dollars):** | Item | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $417,611 | $850,285 | | Net cash used in investing activities | $(396,015) | $(425,887) | | Net cash provided by (used in) financing activities | $(30,008) | $68,944 | | Cash and cash equivalents at end of period | $355,627 | $599,639 | [Condensed Consolidated Statements of Equity](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Equity%20(Holdings)) This table outlines changes in Southwest Gas Holdings' total equity over the reporting periods **Southwest Gas Holdings, Inc. and Subsidiaries - Equity Highlights (Thousands of dollars):** | Item | June 30, 2025 | December 31, 2024 | | :--------------------------------------- | :------------ | :---------------- | | Total equity | $4,115,805 | $3,681,422 | [Southwest Gas Corporation and Subsidiaries](index=13&type=section&id=Southwest%20Gas%20Corporation%20and%20Subsidiaries) This section presents the unaudited condensed consolidated financial statements for Southwest Gas Corporation and its subsidiaries [Condensed Consolidated Balance Sheets](index=13&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20(Corporation)) This table provides a snapshot of Southwest Gas Corporation's assets, liabilities, and equity at specific reporting dates **Southwest Gas Corporation and Subsidiaries - Balance Sheet Highlights (Thousands of dollars):** | Item | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :------------ | :---------------- | | Total assets | $9,688,433 | $9,533,955 | | Total equity | $3,408,373 | $3,271,862 | | Long-term debt, less current maturities | $3,506,237 | $3,504,477 | [Condensed Consolidated Statements of Income](index=14&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20(Corporation)) This table details Southwest Gas Corporation's revenues, expenses, and net income over specified quarterly and year-to-date periods **Southwest Gas Corporation and Subsidiaries - Income Statement Highlights (Thousands of dollars):** | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Regulated operations revenues | $396,318 | $510,093 | $1,142,734 | $1,563,026 | | Operating income | $65,342 | $55,072 | $280,321 | $239,416 | | Net income | $33,677 | $27,594 | $176,619 | $163,419 | [Condensed Consolidated Statements of Comprehensive Income](index=15&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Corporation)) This table presents Southwest Gas Corporation's comprehensive income, including net income and other comprehensive income items **Southwest Gas Corporation and Subsidiaries - Comprehensive Income Highlights (Thousands of dollars):** | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Comprehensive income | $33,944 | $27,980 | $177,154 | $164,189 | [Condensed Consolidated Statements of Cash Flows](index=16&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20(Corporation)) This table summarizes Southwest Gas Corporation's cash inflows and outflows from operating, investing, and financing activities **Southwest Gas Corporation and Subsidiaries - Cash Flow Highlights (Thousands of dollars):** | Item | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $459,287 | $951,694 | | Net cash used in investing activities | $(352,908) | $(374,707) | | Net cash used in financing activities | $(94,415) | $(83,247) | | Cash and cash equivalents at end of period | $323,037 | $564,894 | [Condensed Consolidated Statements of Equity](index=17&type=section&id=Condensed%20Consolidated%20Statements%20of%20Equity%20(Corporation)) This table outlines changes in Southwest Gas Corporation's total equity over the reporting periods **Southwest Gas Corporation and Subsidiaries - Equity Highlights (Thousands of dollars):** | Item | June 30, 2025 | December 31, 2024 | | :--------------------------------------- | :------------ | :---------------- | | Total equity | $3,408,373 | $3,271,862 | [Notes to Condensed Consolidated Financial Statements](index=18&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures regarding the company's accounting policies, financial instruments, segment performance, and significant events like the Centuri separation, offering context to the condensed financial statements [Note 1 – Background and Organization](index=18&type=section&id=Note%201%20%E2%80%93%20Background%20and%20Organization) This note describes the corporate structure of Southwest Gas Holdings, including its subsidiaries and recent changes in ownership - Southwest Gas Holdings, Inc. is a holding company for Southwest Gas Corporation (natural gas distribution) and, until April 22, 2024, Centuri (utility infrastructure services)[38](index=38&type=chunk) - Centuri completed an IPO in April 2024. Following secondary public offerings and a private placement in May and June 2025, Southwest Gas Holdings' ownership in Centuri decreased to **53.3%** at June 30, 2025, and **52.1%** in July 2025. Centuri remains consolidated[40](index=40&type=chunk) [Note 2 – Summary of Significant Accounting Policies](index=18&type=section&id=Note%202%20%E2%80%93%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines the key accounting principles and estimates used in preparing the financial statements, including goodwill and tax rates - The condensed consolidated financial statements are prepared in accordance with SEC rules and U.S. GAAP, involving management estimates and assumptions[41](index=41&type=chunk)[42](index=42&type=chunk) - Goodwill is assessed for impairment annually as of October 1, or more frequently if circumstances indicate. No impairment was deemed to have occurred in the continuing segments during the first six months of 2025[47](index=47&type=chunk) - The Company's effective tax rate was **124.4%** for Q2 2025 (vs **17.1%** in Q2 2024) and **44.8%** for YTD 2025 (vs **16.5%** in YTD 2024), primarily due to pre-tax income differences, amortization of excess deferred income taxes, non-deductible Centuri IPO costs, and the sale of Centuri shares[51](index=51&type=chunk) - Southwest Gas' effective tax rate was **12.3%** for Q2 2025 (vs **6.3%** in Q2 2024) and **19.0%** for YTD 2025 (vs **16.4%** in YTD 2024), mainly due to pre-tax income differences and amortization of excess deferred income taxes[52](index=52&type=chunk) **Goodwill by Segment (Thousands of dollars):** | Segment | December 31, 2024 | June 30, 2025 | | :-------------------------- | :---------------- | :------------ | | Natural Gas Distribution | $11,155 | $11,155 | | Utility Infrastructure Services | $770,046 | $775,349 | | Total Company | $781,201 | $786,504 | [Note 3 – Components of Net Periodic Benefit Cost](index=22&type=section&id=Note%203%20%E2%80%93%20Components%20of%20Net%20Periodic%20Benefit%20Cost) This note details the various components contributing to Southwest Gas's net periodic benefit costs for employee benefit plans **Southwest Gas' Net Periodic Benefit Cost (Thousands of dollars):** | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | QRP Net periodic benefit cost | $667 | $1,784 | $1,332 | $3,568 | | SERP Net periodic benefit cost | $924 | $936 | $1,848 | $1,872 | | PBOP Net periodic benefit cost | $490 | $596 | $980 | $1,191 | [Note 4 – Revenue](index=22&type=section&id=Note%204%20%E2%80%93%20Revenue) This note provides a breakdown of revenues by customer type for regulated operations and by service type for utility infrastructure services - Centuri's contract assets (revenue earned in excess of billings) increased by **$80.3 million** from December 31, 2024, to June 30, 2025, due to incremental work performed where billing milestones were not yet met[66](index=66&type=chunk) - Centuri utilizes a **$125 million** Securitization Facility with PNC, selling trade accounts receivable and contract assets to enhance liquidity. As of June 30, 2025, **$125 million** was outstanding, with no unused capacity[71](index=71&type=chunk)[72](index=72&type=chunk)[73](index=73&type=chunk) **Southwest Gas - Regulated Operations Revenues by Customer Type (Thousands of dollars):** | Customer Type | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Residential | $238,844 | $310,552 | $800,483 | $1,094,789 | | Small commercial | $72,024 | $110,640 | $202,389 | $317,085 | | Large commercial | $17,921 | $29,310 | $39,636 | $67,326 | | Industrial/other | $10,669 | $15,471 | $24,141 | $36,294 | | Transportation | $29,403 | $26,673 | $58,969 | $55,360 | | Total Regulated operations revenues | $396,318 | $510,093 | $1,142,734 | $1,563,026 | **Centuri - Utility Infrastructure Services Revenues by Service Type (Thousands of dollars):** | Service Type | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Gas infrastructure services | $391,945 | $387,352 | $629,423 | $654,909 | | Electric power infrastructure services | $332,107 | $284,723 | $644,710 | $545,189 | | Total Utility infrastructure services revenues | $724,052 | $672,075 | $1,274,133 | $1,200,098 | [Note 5 – Debt](index=25&type=section&id=Note%205%20%E2%80%93%20Debt) This note details the company's long-term debt, credit facilities, and recent debt refinancing and prepayment activities - Southwest Gas amended its **$400 million** revolving credit facility, extending maturity to August 2029 and adding a swingline loan sub-facility. No borrowings were outstanding at June 30, 2025[75](index=75&type=chunk) - Centuri amended its credit agreement in July 2025, refinancing its term loan to **$800 million** (maturity July 2032) and increasing its revolving credit facility to **$450 million** (maturity July 2030)[76](index=76&type=chunk)[178](index=178&type=chunk)[179](index=179&type=chunk) - Southwest Gas Holdings entered a new **$300 million** revolving credit agreement maturing in August 2029. **$35.0 million** was outstanding at June 30, 2025[77](index=77&type=chunk)[78](index=78&type=chunk) - Southwest Gas Holdings prepaid **$325.0 million** of its **$550 million** term loan using Centuri separation proceeds, reducing the balance to **$225 million** and extending its maturity to June 2026[79](index=79&type=chunk) **Long-Term Debt (Thousands of dollars):** | Item | June 30, 2025 (Carrying Amount) | December 31, 2024 (Carrying Amount) | | :--------------------------------------- | :------------------------------ | :-------------------------------- | | Southwest Gas Corporation total long-term debt | $3,506,237 | $3,504,477 | | Southwest Gas Holdings, Inc. total long-term debt, less current maturities | $4,396,867 | $4,348,340 | [Note 6 – Segment Information](index=26&type=section&id=Note%206%20%E2%80%93%20Segment%20Information) This note provides financial performance data segmented by natural gas distribution and utility infrastructure services, including revenues and assets - The Company operates in two reportable segments: natural gas distribution (Southwest Gas) and utility infrastructure services (Centuri)[81](index=81&type=chunk) **Total Segment Revenue by Geographic Area (Thousands of dollars):** | Geographic Area | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | United States | $1,065,261 | $1,135,502 | $2,321,973 | $2,675,478 | | Canada | $55,109 | $46,666 | $94,894 | $87,646 | | Total | $1,120,370 | $1,182,168 | $2,416,867 | $2,763,124 | **Segment Performance (Three Months Ended June 30, 2025, Thousands of dollars):** | Item | Natural Gas Operations | Utility Infrastructure Services | Other | Total | | :--------------------------------------- | :--------------------- | :------------------------------ | :---- | :---------- | | Total segment revenue | $396,318 | $724,052 | $— | $1,120,370 | | Income (loss) before income taxes | $38,411 | $14,266 | $(10,412) | $42,265 | | Net income (loss) attributable to SWX | $33,677 | $5,771 | $(52,331) | $(12,883) | | Segment assets | $9,688,433 | $2,513,389 | $12,123 | $12,213,945 | | Capital expenditures | $199,323 | $20,800 | $— | $220,123 | **Segment Performance (Six Months Ended June 30, 2025, Thousands of dollars):** | Item | Natural Gas Operations | Utility Infrastructure Services | Other | Total | | :--------------------------------------- | :--------------------- | :------------------------------ | :---- | :---------- | | Total segment revenue | $1,142,734 | $1,274,133 | $— | $2,416,867 | | Income (loss) before income taxes | $218,061 | $(16,790) | $(22,150) | $179,121 | | Net income (loss) attributable to SWX | $176,619 | $(14,197) | $(61,435) | $100,987 | | Segment assets | $9,688,433 | $2,513,389 | $12,123 | $12,213,945 | | Capital expenditures | $362,457 | $45,162 | $— | $407,619 | [Note 7 - Centuri Separation](index=30&type=section&id=Note%207%20-%20Centuri%20Separation) This note details the Centuri IPO, subsequent stock offerings, debt repayment, and the tax implications of Centuri's deconsolidation - Following the Centuri IPO in April 2024, Southwest Gas Holdings completed secondary public offerings and a private placement of Centuri common stock in May and June 2025, generating approximately **$448.7 million** in net proceeds used for debt repayment[99](index=99&type=chunk)[100](index=100&type=chunk)[101](index=101&type=chunk) - As of June 30, 2025, Southwest Gas Holdings owned **53.3%** of Centuri, further reduced to **52.1%** in July 2025 after an additional private placement. The Company intends to fully dispose of its Centuri ownership[40](index=40&type=chunk)[102](index=102&type=chunk)[106](index=106&type=chunk) - Tax deconsolidation of Centuri in Q2 2025 resulted in a net charge of approximately **$45.4 million** to income tax expense, including a previously unrecorded deferred tax liability and state income tax deferred tax assets[103](index=103&type=chunk)[104](index=104&type=chunk) [ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=31&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) This section provides management's perspective on the company's financial performance, operational highlights, and future outlook, focusing on the natural gas distribution and utility infrastructure services segments, the regulatory environment, and liquidity. It details the impact of rate changes, customer growth, and the Centuri separation [Executive Summary](index=33&type=section&id=Executive%20Summary) This summary highlights key financial results, strategic actions like the Centuri stock offerings, and operational performance across segments - Southwest Gas Holdings completed secondary public offerings and private placements of Centuri stock, generating **$448.7 million** in net proceeds, with an additional **$22.0 million** in July 2025, all used to repay outstanding indebtedness[117](index=117&type=chunk) - The Company finished Q2 2025 with approximately **$356 million** of cash on a consolidated basis and no longer expects to issue equity in 2025[117](index=117&type=chunk) - Natural gas distribution segment saw **40,000 first-time meter sets** over the past 12 months, representing a **1.8% growth rate**, and **$362.5 million** in capital investment year-to-date[117](index=117&type=chunk) - Utility infrastructure services revenues increased by **$52 million (8%)** to **$724.1 million** in Q2 2025 compared to Q2 2024[117](index=117&type=chunk) **Summary Operating Results (Thousands of dollars, except per share):** | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Natural gas distribution net income | $33,677 | $27,594 | $176,619 | $163,419 | | Utility infrastructure services net income | $5,771 | $5,054 | $(14,197) | $(31,176) | | Corporate and administrative net income (loss) | $(52,331) | $(14,315) | $(61,435) | $(26,173) | | Consolidated Net income (loss) | $(12,883) | $18,333 | $100,987 | $106,070 | | Basic earnings per share | $(0.18) | $0.26 | $1.40 | $1.48 | | Natural Gas Distribution Operating margin | $294,184 | $267,614 | $756,021 | $690,550 | [Results of Natural Gas Distribution](index=34&type=section&id=Results%20of%20Natural%20Gas%20Distribution) The natural gas distribution segment's results improved due to increased operating margin from rate relief and customer growth, partially offset by higher operations and maintenance expenses, depreciation, and net interest deductions [Quarterly Analysis](index=34&type=section&id=Quarterly%20Analysis%20(Natural%20Gas%20Distribution)) This analysis reviews the natural gas distribution segment's financial performance for the three months ended June 30, 2025, compared to the prior year - Operating margin increased by **$26.6 million**, driven by **$23.7 million** from combined rate relief and **$2.5 million** from customer growth (40,000 first-time meter sets over 12 months)[120](index=120&type=chunk) - Operations and maintenance expense rose by **$7.0 million (5%)**, primarily due to increased employee-related labor and benefit costs (**$5 million**) and external contractor services[121](index=121&type=chunk) - Depreciation and amortization expense increased by **$7.3 million (12%)**, reflecting a **$733.0 million (7%)** increase in average gas plant in service[122](index=122&type=chunk) - Other income increased by **$3.6 million**, mainly from a **$4.5 million** increase in COLI policy values and a **$1.6 million** gain on asset sales, partially offset by a **$3.3 million** decrease in interest income due to reduced carrying charges on regulatory account balances[123](index=123&type=chunk) **Natural Gas Distribution - Q2 Performance (Thousands of dollars):** | Item | June 30, 2025 | June 30, 2024 | Change | | :-------------------------- | :------------ | :------------ | :----- | | Regulated operations revenues | $396,318 | $510,093 | $(113,775) | | Net cost of gas sold | $102,134 | $242,479 | $(140,345) | | Operating margin | $294,184 | $267,614 | $26,570 | | Operations and maintenance expense | $136,652 | $129,627 | $7,025 | | Depreciation and amortization | $68,940 | $61,687 | $7,253 | | Operating income | $65,342 | $55,072 | $10,270 | | Net income | $33,677 | $27,594 | $6,083 | [Six-Month Analysis](index=35&type=section&id=Six-Month%20Analysis%20(Natural%20Gas%20Distribution)) This analysis reviews the natural gas distribution segment's financial performance for the six months ended June 30, 2025, compared to the prior year - Operating margin increased by **$65.5 million**, primarily from **$51.1 million** in rate relief and **$7.6 million** from customer growth[126](index=126&type=chunk) - Operations and maintenance expense increased by **$5.6 million (2%)**, mainly due to higher employee-related costs (**$4 million**) and insurance costs (**$2.3 million**)[127](index=127&type=chunk) - Depreciation and amortization expense increased by **$16.1 million (11%)**, reflecting a **$736.0 million (7%)** increase in average gas plant in service[128](index=128&type=chunk) - Other income decreased by **$5.2 million**, mainly due to a **$7.3 million** decline in interest income from reduced carrying charges on deferred purchased gas cost balances[129](index=129&type=chunk) **Natural Gas Distribution - YTD Performance (Thousands of dollars):** | Item | June 30, 2025 | June 30, 2024 | Change | | :-------------------------- | :------------ | :------------ | :----- | | Regulated operations revenues | $1,142,734 | $1,563,026 | $(420,292) | | Net cost of gas sold | $386,713 | $872,476 | $(485,763) | | Operating margin | $756,021 | $690,550 | $65,471 | | Operations and maintenance expense | $266,059 | $260,493 | $5,566 | | Depreciation and amortization | $162,630 | $146,510 | $16,120 | | Operating income | $280,321 | $239,416 | $40,905 | | Net income | $176,619 | $163,419 | $13,200 | [Results of Utility Infrastructure Services](index=36&type=section&id=Results%20of%20Utility%20Infrastructure%20Services) The utility infrastructure services segment experienced revenue growth, primarily in electric services, but profitability was impacted by increased general and administrative costs, including non-recurring separation-related expenses and higher incentive compensation [Quarterly Analysis](index=36&type=section&id=Quarterly%20Analysis%20(Utility%20Infrastructure%20Services)) This analysis reviews the utility infrastructure services segment's financial performance for the three months ended June 30, 2025, compared to the prior year - Revenues increased by **$52.0 million (8%)**, driven by a **$47.4 million** increase in electric utility infrastructure services and a **$4.6 million** increase in gas utility infrastructure services[131](index=131&type=chunk) - Operating margin decreased due to a **$9.1 million** increase in general and administration costs, including **$2.9 million** in non-recurring Centuri separation costs and higher incentive compensation[132](index=132&type=chunk) - Net interest deductions decreased by **$4.4 million**, primarily due to a reduction in average debt balance and lower interest rates on variable-rate borrowings[133](index=133&type=chunk) **Utility Infrastructure Services - Q2 Performance (Thousands of dollars):** | Item | June 30, 2025 | June 30, 2024 | Change | | :--------------------------------------- | :------------ | :------------ | :----- | | Utility infrastructure services revenues | $724,052 | $672,075 | $51,977 | | Utility infrastructure services expenses | $657,671 | $604,545 | $53,126 | | Operating income | $32,158 | $33,145 | $(987) | | Net income | $8,325 | $6,931 | $1,394 | [Six-Month Analysis](index=37&type=section&id=Six-Month%20Analysis%20(Utility%20Infrastructure%20Services)) This analysis reviews the utility infrastructure services segment's financial performance for the six months ended June 30, 2025, compared to the prior year - Revenues increased by **$74.0 million (6%)**, driven by a **$99.5 million** increase in electric utility infrastructure services, partially offset by a **$25.5 million** decrease in gas utility infrastructure services due to adverse weather and project delays[136](index=136&type=chunk) - General and administrative costs increased by **$7.7 million**, including **$4.6 million** in separation-related and non-recurring professional fees, and higher stock-based and other incentive compensation[138](index=138&type=chunk) - Net interest deductions decreased by **$10.6 million**, primarily due to a reduction in average debt balance and lower interest rates on variable-rate borrowings[139](index=139&type=chunk) **Utility Infrastructure Services - YTD Performance (Thousands of dollars):** | Item | June 30, 2025 | June 30, 2024 | Change | | :--------------------------------------- | :------------ | :------------ | :----- | | Utility infrastructure services revenues | $1,274,133 | $1,200,098 | $74,035 | | Utility infrastructure services expenses | $1,186,242 | $1,120,188 | $66,054 | | Operating income | $19,445 | $11,206 | $8,239 | | Net loss | $(16,326) | $(29,474) | $13,148 | [Rates and Regulatory Proceedings](index=37&type=section&id=Rates%20and%20Regulatory%20Proceedings) This section details Southwest Gas's ongoing and recently concluded regulatory activities across its Arizona, Nevada, California, and FERC jurisdictions, including general rate cases, adjustment mechanisms, and PGA filings, outlining their financial implications and operational impacts [Arizona Jurisdiction](index=37&type=section&id=Arizona%20Jurisdiction) This section details regulatory approvals and rate adjustments within Southwest Gas's Arizona service territory - The ACC approved an annual rate increase of approximately **$80.2 million** and a **9.84%** return on common equity in March 2025, following Southwest Gas's 2024 Arizona rate case application[141](index=141&type=chunk)[142](index=142&type=chunk) - The Infrastructure System Integrity Mechanism (SIM) was approved with an annual investment limit of **$50 million**, allowing recovery of revenue requirements for eligible plant[143](index=143&type=chunk) - A PGA Modification was approved, implementing a credit rate of **$0.08138 per therm** effective April 1, 2025, to reduce the over-collected GCBA balance[146](index=146&type=chunk) [Nevada Jurisdiction](index=38&type=section&id=Nevada%20Jurisdiction) This section details regulatory approvals and rate adjustments within Southwest Gas's Nevada service territory - The PUCN approved an annual revenue increase of **$59 million** and a **9.5%** return on common equity in April 2024, affirming full revenue decoupling and tracking of incremental leak survey costs[147](index=147&type=chunk) - The PUCN approved regulatory accounting treatment for line locate activity expenses, effective January 1, 2025, to stem financial attrition between rate cases[149](index=149&type=chunk)[150](index=150&type=chunk) - A DEAA Modification was approved, implementing significant PGA credits (**$0.20000/therm** for southern Nevada, **$0.25000/therm** for northern Nevada) effective July 1, 2025, to address over-collected balances[151](index=151&type=chunk) [California Jurisdiction](index=40&type=section&id=California%20Jurisdiction) This section details Southwest Gas's ongoing general rate case and proposed revenue increases within its California service territory - Southwest Gas's 2024 California general rate case proposes a statewide revenue increase of approximately **$43.7 million** for a 2026 test year, with a requested **11.35%** return on common equity[152](index=152&type=chunk) - A partial settlement was reached with Cal Advocates, with outstanding issues (capital structure, return on equity) litigated in July 2025, and new rates expected in January 2026[152](index=152&type=chunk) [FERC Jurisdiction](index=40&type=section&id=FERC%20Jurisdiction) This section outlines regulatory outcomes for Great Basin's general rate case and the results of its expansion project's open season - Great Basin's general rate case resulted in an approved **$9.6 million** annual revenue increase based on a **9.76%** pretax rate of return, with rates effective September 6, 2024, subject to refund[154](index=154&type=chunk)[155](index=155&type=chunk) - The 2028 Expansion Project's Binding Open Season resulted in potential incremental capacity of up to **~1.76 Bcf of demand per day**[156](index=156&type=chunk) [PGA Filings](index=42&type=section&id=PGA%20Filings) This section details the status of Southwest Gas's purchased gas adjustment (PGA) balancing accounts and customer refunds - As of June 30, 2025, Southwest Gas had an over-collection in its PGA balancing accounts of **$349.0 million**, which will be refunded to customers[157](index=157&type=chunk)[173](index=173&type=chunk) **Southwest Gas' Outstanding PGA Balances (Thousands of dollars):** | Jurisdiction | June 30, 2025 | December 31, 2024 | June 30, 2024 | | :------------------- | :------------ | :---------------- | :------------ | | Arizona | $(64,332) | $(46,980) | $31,510 | | Nevada | $(282,944) | $(195,279) | $(121,323) | | California | $(1,755) | $13,937 | $8,267 | | Total | $(349,031) | $(228,322) | $(81,546) | [Capital Resources and Liquidity](index=42&type=section&id=Capital%20Resources%20and%20Liquidity) This section assesses the company's cash flow, capital expenditures, debt management, and dividend policy, along with factors influencing future liquidity, emphasizing the impact of PGA balances and the Centuri separation [Cash Flows](index=42&type=section&id=Cash%20Flows) This section analyzes the consolidated and segment-specific cash flow changes from operating, investing, and financing activities - Consolidated operating cash flows decreased by **$432.7 million** in YTD 2025 compared to YTD 2024, primarily due to a substantial reduction in the collection of previously deferred purchased gas costs[161](index=161&type=chunk)[162](index=162&type=chunk) - Consolidated investing cash flows decreased by **$29.9 million** in YTD 2025, driven by reduced construction expenditures and property additions[163](index=163&type=chunk) - Consolidated financing cash flows decreased by **$99.0 million** in YTD 2025, mainly due to a **$325.0 million** prepayment on Southwest Gas Holdings' term loan and a **$95.0 million** paydown on its revolving credit facility, utilizing Centuri stock sale proceeds[164](index=164&type=chunk) - Southwest Gas Corporation's operating cash flows decreased by approximately **$492.4 million** in YTD 2025, also primarily due to the reduction in deferred purchased gas cost collections[166](index=166&type=chunk) [Natural Gas Distribution Segment Construction Expenditures, Debt Maturities, and Financing](index=43&type=section&id=Natural%20Gas%20Distribution%20Segment%20Construction%20Expenditures,%20Debt%20Maturities,%20and%20Financing) This section outlines planned capital investments, debt obligations, and funding strategies for the natural gas distribution segment - Construction expenditures for the natural gas distribution segment were **$362.5 million** for the six months ended June 30, 2025[169](index=169&type=chunk) - Estimated natural gas segment construction expenditures for the three-year period ending December 31, 2027, are approximately **$2.6 billion**, with **$880.2 million** expected in 2025[170](index=170&type=chunk) - Approximately **74%** of funding for gas operations, construction, and dividends is expected from operating cash flows, with additional needs met by existing credit facilities, parent equity, and external financing[170](index=170&type=chunk) [Dividend Policy](index=44&type=section&id=Dividend%20Policy) This section states the company's current quarterly dividend and its intention to reevaluate the policy post-Centuri separation - The Board maintained the quarterly dividend at **$0.62 per share**, effective June 2025, and intends to reevaluate the dividend upon completion of the Centuri separation[171](index=171&type=chunk) [Liquidity](index=44&type=section&id=Liquidity) This section discusses factors influencing the company's ability to meet short-term and long-term financial obligations, including credit facilities and debt - Key factors affecting future liquidity include the Centuri separation, natural gas price variability, regulatory policies, access to capital, interest rates, and PGA balances[172](index=172&type=chunk) - Southwest Gas Holdings has a new **$300 million** revolving credit agreement maturing in August 2029, with **$35.0 million** outstanding at June 30, 2025[174](index=174&type=chunk) - Southwest Gas has a **$400 million** revolving credit facility (maturing August 2029) for liquidity and working capital, with no outstanding borrowings at June 30, 2025[176](index=176&type=chunk) - Centuri's multi-currency facility was amended in July 2025, increasing its senior secured revolving credit facility to **$450 million** and extending its maturity to July 2030[178](index=178&type=chunk)[179](index=179&type=chunk) [Critical Accounting Policies and Estimates](index=45&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section confirms no significant changes to the company's critical accounting policies and estimates since the last annual report - There have been no significant changes to the critical accounting policies and estimates disclosed in the 2024 Annual Report on Form 10-K[181](index=181&type=chunk) [ITEM 3. Quantitative and Qualitative Disclosures About Market Risk](index=45&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) This section states that there have been no material changes to the company's market risk disclosures since its 2024 Annual Report on Form 10-K - No material changes have occurred related to market risk disclosures since December 31, 2024[182](index=182&type=chunk) [ITEM 4. Controls and Procedures](index=45&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management of Southwest Gas Holdings, Inc. and Southwest Gas confirms the effectiveness of their disclosure controls and procedures as of June 30, 2025, and reports no material changes in internal control over financial reporting during the second quarter of 2025 - Disclosure controls and procedures for both Southwest Gas Holdings, Inc. and Southwest Gas are deemed effective as of June 30, 2025[184](index=184&type=chunk) - No material changes in internal control over financial reporting occurred during the second quarter of 2025[185](index=185&type=chunk) [Part II - Other Information](index=45&type=section&id=Part%20II%20-%20Other%20Information) This part contains additional disclosures not covered in the financial statements, including legal proceedings and risk factors [ITEM 1. Legal Proceedings](index=45&type=section&id=ITEM%201.%20Legal%20Proceedings) Management believes that none of the various legal proceedings in which the Company and Southwest Gas are named defendants will individually or in the aggregate have a material adverse impact on their financial position or results of operations - Management believes current legal proceedings will not have a material adverse impact on the Company's or Southwest Gas' financial position or results of operations[187](index=187&type=chunk) [ITEM 1A. Risk Factors](index=45&type=section&id=ITEM%201A.%20Risk%20Factors) This section confirms that there have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes to the risk factors previously disclosed in the 2024 Annual Report on Form 10-K as of June 30, 2025[188](index=188&type=chunk) [ITEM 2 through 3. None.](index=46&type=section&id=ITEM%202%20through%203.%20None.) This item indicates no information to report for these sections [ITEM 4. Mine Safety Disclosures](index=46&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) This item is not applicable to the company's operations - Mine Safety Disclosures are not applicable to the registrant[189](index=189&type=chunk) [ITEM 5. Other Information](index=46&type=section&id=ITEM%205.%20OTHER%20INFORMATION) This item reports on director and officer trading arrangements during the fiscal quarter - No directors or Section 16 officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during Q2 2025[189](index=189&type=chunk) [ITEM 6. Exhibits](index=47&type=section&id=ITEM%206.%20EXHIBITS) This section lists all documents filed as exhibits to the Form 10-Q, including various stock purchase agreements, credit agreements, certifications, and XBRL data - Key exhibits filed include Common Stock Purchase Agreements (May 19, 2025, June 13, 2025), Second Amended and Restated Term Loan Credit Agreement (June 27, 2025), Revolving Credit Agreement (June 27, 2025), and First Amendment to Credit Agreement (June 27, 2025)[190](index=190&type=chunk) - Section 302 and 906 Certifications for both Southwest Gas Holdings, Inc. and Southwest Gas Corporation are filed[190](index=190&type=chunk) - Financial statements for both registrants are formatted in Inline XBRL (Extensible Business Reporting Language)[190](index=190&type=chunk) [Signatures](index=48&type=section&id=Signatures) This section contains the required signatures for the Form 10-Q filing

[Executive Summary and Key Highlights](index=1&type=section&id=Executive%20Summary%20and%20Key%20Highlights) Southwest Gas Holdings reported improved Q2 2025 operational and financial performance, reducing debt by over $470 million, strengthening its balance sheet, and advancing its pure-play natural gas utility transformation with positive regulatory developments - The company is transforming into a premier, pure-play, fully regulated natural gas business by reducing its ownership in Centuri to approximately 52%[2](index=2&type=chunk) - Proceeds from two Centuri follow-on offerings were used to reduce debt by over **$470 million**, significantly strengthening the balance sheet[2](index=2&type=chunk)[7](index=7&type=chunk) - Positive regulatory developments include the approval of a capital tracker program in Arizona and new legislation in Nevada (Senate Bill 417) allowing for alternative ratemaking[2](index=2&type=chunk)[7](index=7&type=chunk) - The Great Basin Gas Transmission Company's 2028 Expansion Project saw binding open season capacity demand increase to approximately **1.76 Bcf per day**, up from 1.25 Bcf[3](index=3&type=chunk)[7](index=7&type=chunk) - The Natural Gas Distribution utility achieved a return on period-end equity (ROE) of **8.3%** for the trailing 12 months ended June 30, 2025, and added approximately **40,000 new customers**, a **1.8% growth rate**[7](index=7&type=chunk) [Consolidated Financial Performance](index=1&type=section&id=Consolidated%20Financial%20Performance) Consolidated GAAP net loss of **$12.9 million** in Q2 2025 was driven by Centuri stock sale tax expenses, while adjusted non-GAAP net income increased **71%** to **$38.6 million** reflecting strong utility performance Consolidated Financial Results (Q2 & H1 2025 vs 2024) | (In thousands, except per share items) | Three Months Ended June 30, | Three Months Ended June 30, | Six Months Ended June 30, | Six Months Ended June 30, | | :--- | :--- | :--- | :--- | :--- | | | **2025** | **2024** | **2025** | **2024** | | **Net income (loss)** | **$ (12,883)** | **$ 18,333** | **$ 100,987** | **$ 106,070** | | **Adjusted net income** | **$ 38,588** | **$ 22,533** | **$ 157,959** | **$ 120,994** | | **Consolidated (loss) earnings per share** | **$ (0.18)** | **$ 0.25** | **$ 1.40** | **$ 1.47** | | **Adjusted consolidated earnings per diluted share** | **$ 0.53** | **$ 0.31** | **$ 2.19** | **$ 1.68** | Net Income Reconciliation (Q2 2024 to Q2 2025) | (In millions) | Three Months Ended | Six Months Ended | | :--- | :--- | :--- | | **Net income – June 30, 2024** | **$ 18.3** | **$ 106.1** | | Increase in Southwest Gas net income | 6.1 | 13.2 | | Improvement in Centuri net income/loss | 0.7 | 17.0 | | Increase in corporate and administrative net loss | (38.0) | (35.3) | | **Net (loss) income – June 30, 2025** | **$ (12.9)** | **$ 101.0** | - The Q2 2025 GAAP net loss was primarily due to tax expenses recognized on the company's investment in Centuri following stock sales, which eliminated the ability to include Centuri in consolidated tax returns[8](index=8&type=chunk)[14](index=14&type=chunk) [Segment Performance Analysis](index=5&type=section&id=Segment%20Performance%20Analysis) Natural Gas Distribution drove operational earnings growth, Centuri improved net income, while Corporate and Administrative reported a larger GAAP net loss due to Centuri divestiture tax impacts, though its adjusted net loss improved [Southwest Gas / Natural Gas Distribution](index=5&type=section&id=Southwest%20Gas%20%2F%20Natural%20Gas%20Distribution) Natural Gas Distribution's Q2 2025 net income increased by **$6.1 million**, driven by a **$26.6 million** operating margin increase from rate relief and customer growth, partially offset by higher expenses - **Q2 2025 Performance Drivers vs. Q2 2024:** * **Operating Margin:** Increased by **$26.6 million**, with **$23.7 million** from rate relief and **$2.5 million** from customer growth * **O&M Expense:** Increased by **$7.0 million**, mainly from higher employee-related costs * **Depreciation & Amortization:** Increased by **$9.3 million** due to a **7%** increase in average gas plant in service * **Interest Expense:** Increased by **$4.9 million**, primarily due to interest on over-collected PGA balances[10](index=10&type=chunk) - **Year-to-Date 2025 Performance Drivers vs. 2024:** * **Operating Margin:** Increased by **$65.5 million**, with **$51.1 million** from rate relief and **$7.6 million** from customer growth * **Depreciation & Amortization:** Increased by **$19.0 million**, driven by a **7%** increase in average gas plant in service * **Net Interest Deductions:** Increased by **$13.1 million**[13](index=13&type=chunk) [Centuri / Utility Infrastructure Services](index=7&type=section&id=Centuri%20%2F%20Utility%20Infrastructure%20Services) Centuri's Q2 2025 net income improved by **$0.7 million** due to lower interest expense, with year-to-date net loss improving by **$17.0 million** and a strong **2.3x** book-to-bill ratio - Q2 2025 net income improved by **$0.7 million** and adjusted net income improved by **$2.9 million** compared to Q2 2024, largely due to lower interest expense[11](index=11&type=chunk) - Year-to-date net loss improved by **$17.0 million**, driven by higher work volume and lower interest expense[12](index=12&type=chunk) - Achieved a strong book-to-bill ratio of **2.3x** in the first half of 2025, with customer awards totaling approximately **$3.0 billion**[12](index=12&type=chunk) [Corporate and Administrative](index=8&type=section&id=Corporate%20and%20Administrative) Corporate and Administrative's Q2 GAAP net loss increased by **$38.0 million** due to Centuri stock sale tax expenses, while its adjusted net loss decreased by **$7.0 million** from lower operating and interest expenses - Q2 GAAP net loss increased by **$38.0 million**, primarily due to tax expenses related to the sale of Centuri stock[14](index=14&type=chunk) - Q2 Adjusted net loss decreased by **$7.0 million** compared to the prior year, driven by lower operating and interest expenses[14](index=14&type=chunk) - Year-to-date GAAP net loss increased by **$35.3 million**, while adjusted net loss decreased by **$8.2 million** for similar reasons as the quarterly results[15](index=15&type=chunk) [Guidance and Strategic Updates](index=8&type=section&id=Guidance%20and%20Strategic%20Updates) The company reaffirmed 2025 guidance for Natural Gas Distribution, projecting **$265-$275 million** net income and **$880 million** capital expenditures, while reiterating commitment to Centuri's full separation Southwest Gas / Natural Gas Distribution Segment Guidance | Metric | 2025 Guidance (million USD) | 2025 - 2029 CAGR/Total | | :--- | :--- | :--- | | **Net Income** | $265 - $275 | 6.0% - 8.0% (Adjusted Net Income CAGR) | | **Capital Expenditures** | ~$880 | $4,300 (Total) | | **Rate Base CAGR** | N/A | 6.0% - 8.0% | - The company remains committed to pursuing a pure-play utility strategy through a complete disposition of its remaining interest in Centuri[17](index=17&type=chunk) [Appendix: Financial Tables and Statistics](index=13&type=section&id=Appendix%3A%20Financial%20Tables%20and%20Statistics) This appendix provides detailed financial data, including consolidated earnings, non-GAAP reconciliations, and key gas segment statistics, notably an **8.3%** gas segment ROE and **9.89%** authorized return on common equity [Consolidated Earnings Results](index=13&type=section&id=Consolidated%20Earnings%20Results) Consolidated operating revenues for Q2 2025 were **$1.12 billion**, down from **$1.18 billion** in Q2 2024, with year-to-date revenues at **$2.42 billion** Consolidated Operating Revenues and Net Income | Period | 2025 (thousands USD) | 2024 (thousands USD) | | :--- | :--- | :--- | | **Q2 Operating Revenues** | $1,120,370 | $1,182,168 | | **Q2 Net Income (Loss)** | $(12,883) | $18,333 | | **H1 Operating Revenues** | $2,416,867 | $2,763,124 | | **H1 Net Income** | $100,987 | $106,070 | [Non-GAAP Reconciliations](index=14&type=section&id=Non-GAAP%20Reconciliations) Detailed reconciliations adjust GAAP net income to non-GAAP adjusted net income, with Q2 2025 key adjustments including **$45.4 million** income tax effect, **$4.9 million** amortization, and **$2.3 million** separation costs Reconciliation of Q2 2025 Net Loss to Adjusted Net Income | (In thousands) | Amount | | :--- | :--- | | **Net loss applicable to Southwest Gas Holdings (GAAP)** | **$ (12,883)** | | Plus: Strategic review and Centuri separation | 2,273 | | Plus: Amortization of intangible assets | 4,932 | | Plus: Professional fees associated with one-time events | 834 | | Plus: Income tax effect on Centuri investment | 45,397 | | Less: Income tax effect of adjustments above | (1,965) | | **Adjusted net income applicable to Southwest Gas Holdings** | **$ 38,588** | [Financial and Operational Statistics](index=16&type=section&id=Financial%20and%20Operational%20Statistics) Key statistics include the gas segment's trailing twelve-month ROE of **8.3%**, an authorized return on common equity of **9.89%**, and total system throughput of **116.6 million dekatherms** for H1 2025 Key Financial Statistics (TTM) | Metric | Value (%) | | :--- | :--- | | Twelve months to date return on equity -- total company | 5.5 % | | Twelve months to date return on equity -- gas segment | 8.3 % | | Common stock dividend yield at quarter end | 3.3 % | System Throughput by Customer Class (Six Months Ended June 30) | (In dekatherms) | 2025 | 2024 | | :--- | :--- | :--- | | Residential | 49,061,612 | 52,060,127 | | Small commercial | 19,659,922 | 20,010,847 | | Transportation | 39,595,624 | 42,816,082 | | **Total system throughput** | **116,611,869** | **123,528,957** |