Spire(US:SR)2026-02-03 17:00Financial 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]