10-KPeriod: FY2013

ATMOS ENERGY CORP Annual Report, Year Ended Sep 30, 2013

Filed November 13, 2013For Securities:ATO

Summary

Atmos Energy Corporation's fiscal year 2013 demonstrated solid performance, with net income increasing to $243.2 million, or $2.64 per diluted share, up from $216.7 million, or $2.37 per diluted share in fiscal year 2012. This growth was primarily driven by improvements in rate designs across its natural gas distribution and regulated transmission and storage segments, alongside colder weather that boosted natural gas distribution throughput by 2%. The company also strategically streamlined its operations by divesting its natural gas distribution operations in Georgia in April 2013, following similar sales in Missouri, Illinois, and Iowa in August 2012. Financially, Atmos Energy strengthened its balance sheet by amending its revolving credit agreement to increase borrowing capacity and extending its term, and issued $500 million in long-term senior notes. The company maintained its focus on infrastructure investment, with capital expenditures primarily directed towards safety and reliability improvements in its distribution and transportation systems. These efforts underscore a commitment to sustainable growth and shareholder value, supported by a stable regulatory environment and proactive management of operational and financial risks.

Financial Statements
Beta
Gross Profit$1.41B
Operating Expenses$910.17M
Operating Income$501.88M
Interest Expense$128.38M
Net Income$243.19M
EPS (Basic)$2.68
EPS (Diluted)$2.64
Shares Outstanding (Basic)90.53M
Shares Outstanding (Diluted)91.71M

Key Highlights

  • 1Net income increased by 12% to $243.2 million ($2.64 per diluted share) in FY2013, compared to $216.7 million ($2.37 per diluted share) in FY2012.
  • 2Divested Georgia natural gas distribution operations on April 1, 2013, as part of a strategy to streamline regulated operations.
  • 3Completed 13 regulatory proceedings in FY2013, resulting in a $71.4 million increase in annual operating income, primarily from rate design changes in the Mid-Tex and West Texas divisions.
  • 4Strengthened liquidity and borrowing capacity by amending its revolving credit agreement and issued $500 million in 4.15% 30-year unsecured senior notes.
  • 5Capital expenditures for FY2013 were $845.0 million, with a significant portion allocated to improving the safety and reliability of its distribution and transportation systems.
  • 6The regulated natural gas distribution segment accounted for approximately 65% of consolidated net income, while the regulated transmission and storage segment contributed approximately 30%.

Frequently Asked Questions

For the fiscal year ended September 30, 2013, Atmos Energy reported a net income of $243.2 million, or $2.64 per diluted share, representing an increase from the prior year's net income of $216.7 million, or $2.37 per diluted share.

In fiscal year 2013, Atmos Energy completed the divestiture of its Georgia natural gas distribution operations and strategically streamlined its balance sheet by amending its revolving credit agreement and issuing $500 million in long-term senior notes. The company also continued to invest heavily in infrastructure for safety and reliability.

Atmos Energy completed 13 regulatory proceedings in fiscal year 2013, which were expected to increase annual operating income by $71.4 million. Key rate design changes implemented in the Mid-Tex and West Texas divisions aimed to improve the ratable recovery of operating income throughout the year by adjusting customer base charges and consumption charges.

As of September 30, 2013, Atmos Energy had a total debt to total capitalization ratio of 52.2%, indicating a stable financial position. The company also had access to over $1 billion in working capital funding through its committed revolving credit facilities and commercial paper program, and was in compliance with all debt covenants.