ONE Gas(US:OGS)2025-02-20 21:32Financial Performance - Total revenues for 2024 were $2,083,558, a decrease of 12.1% from $2,371,990 in 2023[229]. - Net income for 2024 was $222,850, down 3.3% from $231,232 in 2023[229]. - Operating income increased to $399,044 in 2024, up 5.4% from $377,590 in 2023[229]. - Earnings per share (EPS) for 2024 were $3.92, a decrease from $4.16 in 2023[229]. - Total assets increased to $8,425,571 in 2024, up from $7,770,994 in 2023, reflecting a growth of 8.4%[233]. - Cash and cash equivalents rose to $57,995 in 2024, compared to $18,835 in 2023, indicating a significant increase[233]. - Total equity grew to $3,104,548 in 2024, an increase of 12.3% from $2,765,877 in 2023[235]. - Cash provided by operating activities decreased significantly to $368.41 million in 2024 from $939.53 million in 2023, reflecting a decline of 60.7%[237]. - Capital expenditures increased to $703.17 million in 2024, up from $666.63 million in 2023, representing a rise of 5.5%[237]. - Common stock dividends per share increased to $2.64 in 2024 from $2.60 in 2023, reflecting a 1.5% increase[238]. Customer Base and Market Position - The company has approximately 2.3 million customers across three states, indicating a broad customer base and reduced concentration of credit risk[213]. - The company served approximately 2.3 million customers across Oklahoma, Kansas, and Texas, maintaining its customer base[242]. - The company had no single external customer contributing 10% or more of gross revenues in 2024, 2023, and 2022, indicating a diversified revenue base[243]. Debt and Financing - ONE Gas maintains a $1.35 billion revolving credit agreement, which supports its financing needs[19]. - The ONE Gas Credit Agreement was increased to $1.35 billion in October 2024, up from $1.275 billion in June 2024[308][309]. - At December 31, 2024, the total debt-to-capital ratio was 51.8%, compliant with the ONE Gas Credit Agreement covenants[311]. - Total long-term debt, net, decreased to $2.414 billion in 2024 from $2.961 billion in 2023, with significant reductions in senior notes due February 2024 and March 2024[315]. - The company issued $300 million of 5.10% senior notes due April 2029 in December 2023, and repaid $300 million of 3.61% senior notes upon maturity[318]. - In August 2024, the company reopened its 5.10% senior notes due 2029, issuing an additional $250 million, bringing the total outstanding to $550 million[319]. Risk Management - ONE Gas utilizes purchased-gas cost adjustment mechanisms to mitigate commodity price risk associated with natural gas fluctuations[211]. - Interest-rate risk is managed through fixed-rate and floating-rate debt, as well as interest-rate swaps to stabilize borrowing costs[212]. - The company emphasizes the importance of effective risk-management policies and compliance with internal controls to mitigate operational risks[210]. - The company is subject to various market risks, including changes in inflation, interest rates, and regulatory requirements[210]. Regulatory and Compliance - Regulatory assets included $379 million of deferred costs and $490 million of regulatory liabilities as of December 31, 2024[225]. - The company recorded no write-offs of regulatory assets resulting from failure to meet capitalization criteria during 2024, 2023, and 2022, indicating effective regulatory asset management[277]. - The company reported a net regulatory liability of $(110,872,000) as of December 31, 2024, compared to $(204,165,000) in 2023[298][299]. - The company adopted new accounting standards for income tax disclosures and segment reporting, effective for annual periods beginning after December 15, 2024, and December 15, 2023, respectively[293][294]. Pension and Employee Benefits - The discount rate for pension plans increased to 5.70% in 2024 from 5.30% in 2023[348]. - The expected long-term return on plan assets for pension plans was 6.70% in 2024, slightly down from 6.75% in 2023[349]. - The pension benefit obligation decreased from $803.6 million in 2023 to $731.1 million in 2024, reflecting a reduction of approximately 9%[356]. - The net periodic benefit cost for pension benefits was a credit of $5.5 million in 2024, compared to a credit of $7.5 million in 2023[360]. - The company expects to contribute $9.8 million to its defined benefit pension plans in 2025, with no contributions planned for other postemployment benefit plans[358]. Environmental and Remediation Costs - The company is subject to various environmental regulations that may lead to increased compliance costs and potential future expenditures[396]. - Kansas Gas Service requested to increase the cap on the AAO from $15.0 million to $32 million on January 3, 2025, to cover additional remediation costs[392]. - The reserve for remediation of MGP sites was $14.3 million as of December 31, 2024, unchanged from 2023[394]. - The company received $1.7 million in insurance proceeds for remediation costs during 2024[392].