Atmos Energy Corporation Reports Earnings for Fiscal 2024 Third Quarter; Reaffirms Fiscal 2024 Guidance

Rhea-AI Summary

Atmos Energy (NYSE: ATO) reported its fiscal 2024 third quarter results, highlighting earnings per diluted share of $6.00 on net income of $908.9 million year-to-date. The company's capital expenditures reached $2.1 billion, with 82% focused on safety and reliability. Atmos Energy maintains a strong financial profile with 61% equity capitalization and $4.3 billion in available liquidity.

The company reaffirmed its fiscal 2024 guidance, expecting earnings per diluted share to be in the range of $6.70 - $6.80. Capital expenditure guidance for fiscal 2024 is approximately $3.1 billion. The Board of Directors declared a quarterly dividend of $0.805 per common share, with an indicated annual dividend of $3.22 for fiscal 2024, representing an 8.8% increase over fiscal 2023.

Positive

• Earnings per diluted share of $6.00 on net income of $908.9 million year-to-date
• Capital expenditures of $2.1 billion, with 82% focused on safety and reliability
• Strong financial profile with 61% equity capitalization and $4.3 billion in available liquidity
• Implemented $340.6 million in annualized regulatory outcomes
• 8.8% increase in annual dividend for fiscal 2024
• Reaffirmed fiscal 2024 earnings guidance in the range of $6.70 - $6.80 per diluted share

Negative

• None.

Insights

Financial Analyst

Atmos Energy's Q3 FY2024 report shows solid financial performance with earnings per diluted share of $6.00 and net income of $908.9 million year-to-date. The company's capital expenditures of $2.1 billion, with 82% focused on safety and reliability, demonstrate a commitment to infrastructure improvement. The strong financial profile with 61% equity capitalization and $4.3 billion in available liquidity provides financial flexibility.

The implementation of $340.6 million in annualized regulatory outcomes, with an additional $176.5 million in progress, suggests favorable regulatory environment. The company's reaffirmation of its FY2024 EPS guidance range of $6.70 to $6.80 per diluted share, with expectations at the upper end, indicates confidence in meeting financial targets. The 8.8% increase in annual dividend to $3.22 is a positive signal for shareholders, reflecting management's optimism about future cash flows.

Utility Industry Expert

Atmos Energy's focus on safety and reliability in its capital expenditures aligns with industry best practices and regulatory expectations. The $2.1 billion spent year-to-date, with $3.1 billion planned for FY2024, indicates a substantial investment in infrastructure. This level of investment is typical for a utility aiming to modernize its network and improve service quality.

The company's success in implementing $340.6 million in annualized regulatory outcomes, with more in progress, suggests a constructive relationship with regulators. This is important in the utility sector, where rate cases and regulatory approvals significantly impact financial performance. The 61% equity capitalization is within the healthy range for utilities, balancing financial stability with the leverage needed for capital-intensive projects. Overall, Atmos Energy's operational and financial strategies appear well-aligned with current utility industry trends and challenges.

Market Research Analyst

Atmos Energy's performance should be viewed in the context of the broader natural gas utility market. The company's customer base of over three million across 1,400 communities provides a stable revenue foundation. The 8.8% dividend increase is notably higher than the industry average, which could attract income-focused investors in the current economic environment.

The company's guidance towards the upper end of its EPS range suggests resilience against inflationary pressures and interest rate fluctuations that have challenged many utilities. Atmos Energy's continued investment in infrastructure, particularly in safety and reliability, positions it well for potential regulatory changes or increased scrutiny on gas utilities. However, investors should monitor the ongoing debate around the long-term role of natural gas in the energy transition, as this could impact future growth prospects and regulatory treatment for companies like Atmos Energy.

DALLAS--(BUSINESS WIRE)-- Atmos Energy Corporation (NYSE: ATO) today reported consolidated results for its third fiscal quarter ended June 30, 2024. This news release should be read in conjunction with our Form 10-Q and earnings slides which are concurrently being posted at www.atmosenergy.com.

Fiscal Year to Date Highlights

• Earnings per diluted share of $6.00 on net income of $908.9 million.
• Capital expenditures were $2.1 billion; approximately 82 percent focused on safety and reliability.
• Strong financial profile with 61% equity capitalization and $4.3 billion in available liquidity.
• Implemented $340.6 million in annualized regulatory outcomes; $176.5 million in progress.

Outlook

• Fiscal 2024 earnings per diluted share guidance expected to be in the range of $6.70 - $6.80 per diluted share.
• Fiscal 2024 capital expenditure guidance expected to be approximately $3.1 billion.
• The company's Board of Directors has declared a quarterly dividend of $0.805 per common share. The indicated annual dividend for fiscal 2024 is $3.22, which represents an 8.8% increase over fiscal 2023.

"Our third quarter results continue to reflect the dedication, focus and effort of all 5,000 employees to execute our strategy and safely provide natural gas service to over three million customers in 1,400 communities," said Kevin Akers, President and Chief Executive Officer of Atmos Energy. "Based on our year-to-date performance, we believe fiscal 2024 earnings will be in the upper end of our earnings guidance range of $6.70 to $6.80 per diluted share."

Conference Call to be Webcast August 8, 2024

Atmos Energy will host a conference call with financial analysts to discuss the fiscal 2024 third quarter financial results on Thursday, August 8, 2024, at 10:00 a.m. Eastern Time. The domestic telephone number is 800-715-9871 and the international telephone number is 646-307-1963. The conference ID is 15904. The conference call will be webcast live on the Atmos Energy website at www.investors.atmosenergy.com/events-and-presentations. A playback of the call will be available on the website later that day.

Forward-Looking Statements

The matters discussed in this news release may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact included in this news release are forward-looking statements made in good faith by the company and are intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. When used in this news release or any of the company’s other documents or oral presentations, the words “anticipate”, “believe”, “estimate”, “expect”, “forecast”, “goal”, “intend”, “objective”, “plan”, “projection”, “seek”, “strategy” or similar words are intended to identify forward-looking statements. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those discussed in this release, including the risks relating to regulatory trends and decisions, the company’s ability to continue to access the credit and capital markets, and the other factors discussed in the company’s reports filed with the Securities and Exchange Commission. These risks and uncertainties include the following: federal, state and local regulatory and political trends and decisions, including the impact of rate proceedings before various state regulatory commissions; increased federal regulatory oversight and potential penalties; possible increased federal, state and local regulation of the safety of our operations; possible significant costs and liabilities resulting from pipeline integrity and other similar programs and related repairs; the inherent hazards and risks involved in distributing, transporting and storing natural gas; the availability and accessibility of contracted gas supplies, interstate pipeline and/or storage services; increased competition from energy suppliers and alternative forms of energy; failure to attract and retain a qualified workforce; natural disasters, terrorist activities or other events and other risks and uncertainties discussed herein, all of which are difficult to predict and many of which are beyond our control; increased dependence on technology that may hinder the Company's business if such technologies fail; the threat of cyber-attacks or acts of cyber-terrorism that could disrupt our business operations and information technology systems or result in the loss or exposure of confidential or sensitive customer, employee or Company information; the impact of new cybersecurity compliance requirements; adverse weather conditions; the impact of greenhouse gas emissions or other legislation or regulations intended to address climate change; the impact of climate change; the capital-intensive nature of our business; our ability to continue to access the credit and capital markets to execute our business strategy; market risks beyond our control affecting our risk management activities, including commodity price volatility, counterparty performance or creditworthiness and interest rate risk; the concentration of our operations in Texas; the impact of adverse economic conditions on our customers; changes in the availability and price of natural gas; and increased costs of providing health care benefits, along with pension and postretirement health care benefits and increased funding requirements.

Accordingly, while we believe these forward-looking statements to be reasonable, there can be no assurance that they will approximate actual experience or that the expectations derived from them will be realized. Further, the company undertakes no obligation to update or revise any of our forward-looking statements whether as a result of new information, future events or otherwise.

About Atmos Energy

Atmos Energy Corporation, an S&P 500 company headquartered in Dallas, is the country’s largest natural gas-only distributor. We safely deliver reliable, efficient and abundant natural gas to over 3.3 million distribution customers in over 1,400 communities across eight states located primarily in the South. As part of our vision to be the safest provider of natural gas services, we are modernizing our business and infrastructure while continuing to invest in safety, innovation, environmental sustainability and our communities. Atmos Energy manages proprietary pipeline and storage assets, including one of the largest intrastate natural gas pipeline systems in Texas. Find us online at http://www.atmosenergy.com, Facebook, Twitter, Instagram and YouTube.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240807508996/en/

Analysts and Media Contact:

Dan Meziere (972) 855-3729

Source: Atmos Energy Corporation

FAQ

What were Atmos Energy's (ATO) earnings per share for the fiscal 2024 third quarter?

Atmos Energy reported earnings per diluted share of $6.00 on net income of $908.9 million for the fiscal year to date, which includes the third quarter of 2024.

How much did Atmos Energy (ATO) spend on capital expenditures in fiscal 2024 so far?

Atmos Energy's capital expenditures were $2.1 billion for the fiscal year to date, with approximately 82% focused on safety and reliability.

What is Atmos Energy's (ATO) earnings guidance for fiscal 2024?

Atmos Energy reaffirmed its fiscal 2024 earnings guidance, expecting earnings per diluted share to be in the range of $6.70 - $6.80.

Has Atmos Energy (ATO) increased its dividend for fiscal 2024?

Yes, Atmos Energy increased its indicated annual dividend for fiscal 2024 to $3.22 per share, representing an 8.8% increase over fiscal 2023.