UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | Commission Exact name of registrant as specified in its charter and State of I.R.S. | | | | --- | --- | --- | | File Number principal of ice address and telephone number Incorporation Employer Ident ...

Financial Data and Key Metrics Changes - The company's adjusted EPS for the fourth quarter of 2022 was $1.16 per share, down from $1.49 per share in the previous year, indicating a decrease in adjusted EPS year-over-year [134] - Full year 2022 adjusted EPS came in at $3 per share compared to $4 per share for 2021, reflecting a significant adjustment related to the loss on Mountain West of $349 million [146][147] - The utility's margin increased by $55 million compared to the previous year, driven by constructive regulatory relationships and improved regulatory trackers [55] Business Line Data and Key Metrics Changes - Centuri delivered record revenues of $2.8 billion in 2022, marking the 13th consecutive year of revenue increases, with an increase of $602 million from the prior year [12][70] - The utility was awarded $14 million in rate relief from the Nevada rate case, contributing to an additional $17 million in margin from strong customer growth [22] - Operating and maintenance (O&M) expenses increased by $53 million due to inflationary pressures and higher labor costs, which nearly offset the margin increase [56] Market Data and Key Metrics Changes - The allowed rate base in Southwest Gas Corporation's service territories increased from $4.2 billion to $4.9 billion, enhancing the company's growth potential [5] - The company set over 41,000 first-time meter sets last year, the highest total in over 10 years, with expected customer growth of 1.5% to 2% [27] - The company anticipates a capital investment plan of approximately $2 billion over the next three years, driven by strong demand for natural gas and investments in pipe replacement [60] Company Strategy and Development Direction - The company is transitioning to a pure-play utility model, enhancing visibility and alignment with investors, and focusing on utility optimization and stable recurring cash flow generation [10] - The strategic spin-off of Centuri is expected to enhance stockholder alignment and value creation, with plans to complete the spin by the fourth quarter of 2023 or the first quarter of 2024 [9][73] - The company aims for 5% to 7% rate base growth over the next three years while maintaining a strong investment-grade balance sheet [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving guidance expectations for 2023 despite challenges faced in 2022, attributing underperformance to nonrecurring items [21] - The company is focused on continuous improvement in customer satisfaction, safety, and operational efficiency, with plans to engage consultants for a deep dive review of the utility's cost structure [31][66] - Management highlighted favorable demand dynamics and ongoing constructive regulatory relationships as key drivers for future growth [18][43] Other Important Information - The company plans to issue $250 million of equity and $550 million in debt at the holdings level in 2023 to support its financing needs [25] - The company is committed to maintaining a competitive dividend, holding it flat in 2023, with a review of the policy at the time of the Centuri spin [95][153] - The company has seen an increase in receivable balances due to higher natural gas prices, impacting its gas cost recovery mechanisms [32] Q&A Session Summary Question: What led to a weaker fourth quarter for the utility? - Management indicated that bad debt and uncollectibles stemming from COVID contributed about $6 million to the weaker performance, along with a legal settlement and reserves related to gas acquisition costs [45][77] Question: Can you provide insights into Centuri's EBITDA margin guidance? - Management noted that variability in the margin could arise from potential impacts on revenue from offshore wind projects, which are expected to be higher-margin work [79] Question: What improvements are expected from the consulting study on O&M costs? - Management confirmed that the consulting study aims to identify additional initiatives for operational efficiency, building on internal reviews already conducted [83] Question: How will the timing of the Centuri spin be affected by market conditions? - Management stated that the timing will be evaluated based on various factors, including the Form 10 and private letter ruling, and will consider market conditions for financing [84][86] Question: What is the net debt balance at Century at the end of 2022? - The net debt position at Century was approximately $1.1 billion, composed of over $1 billion on the term loan and just under $100 million under the revolving credit facility [88] Question: How will the holding company expenses change post-spin? - Management indicated that post-spin, holding company expenses will largely be driven by interest expense associated with the holdings debt issued in conjunction with the 2023 financing plan [126]

Natural Gas Supply and Pricing - Southwest acquired natural gas from 36 suppliers in 2022, ensuring competitive pricing and reliability in its supply portfolio[39] - For the 2022/2023 heating season, firm fixed-price physical commodity purchases ranged from approximately $4.59 to $9.89 per dekatherm[42] - Southwest entered into a $450 million term loan in January 2023 to fund increased supply costs due to rising natural gas prices[50] - The natural gas market has experienced price spikes due to low storage levels and extreme weather conditions, impacting supply costs[50] - Southwest's price volatility mitigation program includes fixed-price purchasing arrangements, primarily in California and Arizona jurisdictions[41] - The company has limited market area storage services availability, which impacts its operational flexibility and average annual price of natural gas[44] - Southwest's natural gas supplies are primarily obtained from producing regions in Colorado, New Mexico, Texas, and Canada[49] - Southwest may file for rate increases to recover the increased cost of purchased gas, but there is no assurance of timely rate relief[86] - Rate adjustment clauses allow Southwest to recover increases in purchased gas costs, but disallowance of these costs could negatively impact cash flows and earnings[116] - Rising natural gas prices may reduce Southwest's liquidity and earnings, impacting capital resources and potentially leading to short-term borrowings[114] Centuri Operations and Financials - Centuri's backlog as of December 31, 2022, was approximately $441 million related to outstanding fixed-priced contracts[66] - In 2022, approximately 82% of Centuri's revenue was earned under unit-price and time-and-materials contracts[66] - Centuri served over 400 customers in 2022, with Southwest accounting for approximately 5% of total revenue[68] - Centuri's acquisition of Riggs Distler in 2021 positions the company to support the development of onshore infrastructure for offshore wind and power[65] - Over half of Centuri's utility infrastructure services revenues were generated from ten customers in 2022, indicating a concentration of risk[84] - Inflationary pressures have negatively affected Centuri's construction costs, particularly in fuel, labor, and materials, impacting profitability and cash flows[88] - Centuri's fixed-price contracts are susceptible to losses due to unforeseen inflation and cost increases, affecting profitability[90] - Supply chain constraints have negatively impacted Centuri's work mix and volumes, potentially leading to delays and increased costs[101] - Labor disruptions at Centuri could materially affect business operations and cash flows due to collective bargaining agreements[104] - Weather conditions significantly impact Centuri's operations, with revenues typically lowest in the first quarter due to winter weather[93] - The Centuri Spin-Off will lead to both Southwest Gas Holdings and Centuri becoming less diversified companies, increasing their vulnerability to market conditions[108] Financial and Economic Conditions - The consumer price index increased significantly throughout 2022, potentially impacting operating expenses due to heightened inflation[85] - The Federal Reserve has raised benchmark interest rates, which is likely to increase borrowing costs for the company over time[89] - Economic conditions may affect Southwest's ability to finance capital expenditures, with rising interest rates posing a particular challenge[119] - A significant reduction in the company's credit ratings could lead to increased borrowing costs and diminish financial results[129] - Any downgrade in credit ratings may require the company to pay higher interest rates and could decrease the pool of potential investors[130] - Economic downturns, such as those caused by rising inflation and increasing interest rates, may adversely affect the company's financial condition and results of operations[128] Regulatory and Compliance Risks - The U.S. Department of Transportation's PHMSA instituted Distribution Integrity Management Programs effective February 2010 to enhance safety in gas distribution pipelines[64] - Regulatory actions and policies can significantly impact Southwest's earnings and cash flows, particularly regarding rate increases and compliance with environmental laws[123] - The company faces risks related to obtaining necessary permits and approvals for pipeline expansion and infrastructure development, which could negatively impact business operations and earnings[127] Strategic Initiatives and Challenges - The company announced a spin-off of Centuri to create long-term growth, with the MountainWest Sale closing on February 14, 2023[106] - The Centuri Spin-Off is subject to various conditions, and failure to meet these could delay or prevent the transaction[106] - The cash surrender value of company-owned life insurance policies may fluctuate significantly, impacting earnings during periods of stock market volatility[117] - Changes in pension asset values and actuarial assumptions could adversely affect the financial results of Southwest, potentially increasing pension expenses[118] - Natural disasters, public health crises, and geopolitical events could adversely affect the company's operations and financial condition[133] - A slow response to events causing business interruptions may negatively impact operations and earnings[134] - The company may struggle to integrate business acquisitions effectively, which could result in increased costs and decreased expected revenues[131] Workforce and Employment - At December 31, 2022, Southwest had 2,351 regular full-time equivalent employees, with an average tenure of approximately 11 years[76] - Centuri had 11,008 regular full-time equivalent employees as of December 31, 2022, with a majority represented by unions[77]

Southwest Gas Holdings, Inc. (NYSE:SWX) Q3 2022 Earnings Conference Call November 9, 2022 1:00 PM ET Company Participants Thomas Moran - Vice President of General Counsel and Corporate Secretary Karen Haller - President and Chief Executive Officer Justin Brown - President of Southwest Gas Corporation Paul Daily - President and Chief Executive Officer of Centuri Group Gregory Peterson - Senior Vice President and Chief Financial Officer Conference Call Participants Richard Sunderland - JPMorgan Chase & Co. Ju ...

2022 Third Quarter Earnings Conference Call November 9, 2022 Speakers and Agenda KAREN HALLER PRESIDENT AND CEO SOUTHWEST GAS HOLDINGS JUSTIN BROWN PAUL DAILY PRESIDENT AND CEO CENTURI GROUP, INC. GREG PETERSON SVP/CFO SOUTHWEST GAS HOLDINGS VP/GENERAL COUNSEL/ CORPORATE SECRETARY SOUTHWEST GAS HOLDINGS THOMAS MORAN PRESIDENT SOUTHWEST GAS CORPORATION Presentation Agenda Strategic Update Business Updates Third Quarter Results Guidance and Outlook November 9, 2022 | 2 Strategic Update Strategic Update Robert ...

| --- | --- | --- | --- | --- | --- | |------------------------------------------|-------|-------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | | 2022 Second Quarter | | | | | | | Earnings Conference Call August 10, 2022 | | | | | | | | | | | | | Participants KAREN HALLER PRESIDENT AND CEO SOUTHWEST GAS HOLDINGS JUSTIN BROWN PRESIDENT SOUTHWEST GAS CORPORATION GREG PETERSON SVP/CFO SOUTHWEST GAS HOLDINGS BOYD NELSON VP/STRATEGY/INVESTOR RELATIONS SOUTHWEST GAS HOLDINGS Second Quarter 20 ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | Commission Exact name of registrant as specified in its charter and State of I.R.S. | | | | | --- | --- | --- | --- | | File Number principal of ice address and telephone number Incorporation Employe ...

2022 First Quarter Earnings Conference Call May 9, 2022 Participants KAREN HALLER PRESIDENT AND CEO SOUTHWEST GAS HOLDINGS PAUL DAILY PRESIDENT AND CEO CENTURI GREG PETERSON SVP/CFO SOUTHWEST GAS HOLDINGS JUSTIN BROWN SVP/GENERAL COUNSEL SOUTHWEST GAS CORPORATION BOYD NELSON VP/STRATEGY/INVESTOR RELATIONS SOUTHWEST GAS HOLDINGS First Quarter 2022 Earnings Presentation May 9, 2022 | 2 Agenda ▪ Leadership and Strategic Update ▪ Business Updates ▪ First Quarter Results ▪ Guidance and Outlook First Quarter 2022 ...

Financial Performance - The Company reported record revenues of $524 million in Q1 2022, an increase of $160 million, or 44%, compared to Q1 2021[142] - Contribution to consolidated net income from natural gas distribution operations was $111,795,000 in Q1 2022, down from $118,715,000 in Q1 2021[143] - Net income attributable to Centuri decreased to $(23.486) million in Q1 2022 from $(859) thousand in Q1 2021[158] - Operating margin increased by $73 million, driven by customer growth contributing $14 million and combined rate relief providing $44 million[151] - Operating margin for regulated operations was $379,418,000 in Q1 2022, compared to $365,911,000 in Q1 2021[143] - Other income decreased by $18.3 million between the twelve-month periods, primarily due to fluctuations in COLI policy cash surrender values[155] Customer and Market Growth - As of March 31, 2022, the Company had 2,171,000 natural gas customers, with 1,161,000 in Arizona, 806,000 in Nevada, and 204,000 in California[133] - Operating margin increased by $14 million quarter over quarter, with approximately $7 million attributable to customer growth from 38,000 first-time meter sets[144] - Utility infrastructure services revenues increased by $159.9 million, or 44%, in Q1 2022, including $113.8 million from Riggs Distler[158] Acquisitions and Investments - The Company completed the acquisition of Dominion Energy Questar Pipeline in December 2021, diversifying its operations with over 2,000 miles of interstate natural gas pipelines[128] - A general rate case application was filed in December 2021 proposing a revenue increase of approximately $90.7 million, reflecting substantial capital investments[170] - The Nevada COYL replacement program was approved in January 2022, allowing capital investments up to $5 million per year for five years[186] - Management estimates that natural gas segment construction expenditures during the five-year period ending December 31, 2026, will be approximately $2.5 to $3.5 billion, with $650 million to $700 million scheduled for 2022[212] Regulatory and Rate Changes - The Nevada general rate case was finalized with rate relief effective April 2022[142] - The Delivery Charge Adjustment (DCA) filing in April 2022 proposed a rate to return $10.5 million, the over-collected balance at the end of Q1 2022[172] - A general rate case filed on August 31, 2021, proposed a combined revenue increase of approximately $28.7 million, with a return on common equity of 9.90%[184] - The Infrastructure Replacement Mechanism allows for the deferral and recovery of costs associated with accelerated replacement of qualifying infrastructure[188] Financial Position and Cash Flow - Cash flows from consolidated operating activities increased by $239 million in the first three months of 2022 compared to the same period in 2021, primarily due to changes in purchased gas costs[202] - The company reported a significant increase in cash and cash equivalents, rising from $223 million as of December 31, 2021, to $625 million as of March 31, 2022, largely due to a $600 million Senior Notes issuance[201] - Net cash provided by consolidated financing activities increased by $163 million in the first three months of 2022 compared to the same period in 2021, primarily due to the issuance of $600 million in notes[206] Expenses and Cost Management - Operations and maintenance expense increased by $43 million, or 10%, primarily due to inflationary impacts and higher costs in customer service and legal claims[152] - Depreciation and amortization expense rose by $17.5 million, or 7%, attributed to a $562 million, or 7%, increase in average gas plant in service[153] - Utility infrastructure services expenses rose by $167.6 million, including $104.1 million incurred by Riggs Distler, due to higher input costs and inflationary pressures[159] Strategic Alternatives and Future Plans - The Company is evaluating strategic alternatives, including a potential sale of the Company or a spin-off of Centuri[142] - The company plans to continue requesting regulatory support for projects aimed at improving system flexibility and reliability, as well as expanding to underserved areas[212] - The company anticipates a decision in 2023 regarding the Carbon Offset Program, which aims to provide customers options to reduce GHG emissions[183] - The company has a proposed annual budget of approximately $3 million for its Conservation and Energy Efficiency plan for 2022-2024[190] Challenges and Risks - The company is facing various regulatory and operational challenges, including changes in rate design and the impact of inflation on costs[231] - There are uncertainties regarding the timing and magnitude of costs necessary to integrate newly acquired operations, particularly for MountainWest[231] - The impact of geopolitical influences and changes in pipeline capacity on operational costs is a concern for the company[231] - There are risks associated with the ability to raise capital in external financings and remain within debt covenants[231] - The company cautions against undue reliance on forward-looking statements due to potential changes in circumstances[232]

Southwest Gas Holdings, Inc. (NYSE:SWX) Q1 2022 Earnings Conference Call May 9, 2022 6:00 PM ET Company Participants Karen Haller – President and Chief Executive Officer Paul Daily – President, Chief Executive Officer of Centuri Greg Peterson – Senior Vice President, Chief Financial Officer Justin Brown – Senior Vice President, General Counsel Boyd Nelson – Vice President of Strategy, Investor Relations Conference Call Participants Richard Sunderland – JPMorgan Julien Dumoulin-Smith – Bank of America Rya ...