10-QPeriod: Q2 FY2013

ATMOS ENERGY CORP Quarterly Report for Q2 Ended Mar 31, 2013

Filed May 2, 2013For Securities:ATO

Summary

Atmos Energy Corporation (ATO) reported solid financial results for the three and six months ended March 31, 2013. The company demonstrated revenue growth across its segments, with a notable increase in operating income driven by regulated operations. Key to this performance was the natural gas distribution segment, which saw improved revenue and throughput, partially offset by the impact of recent rate design changes in Texas. The regulated transmission and storage segment also contributed positively with increased transportation volumes and operating income. Financially, Atmos Energy strengthened its balance sheet by issuing new long-term debt and repaying short-term borrowings. The company also proactively managed its liquidity through amendments to its credit facilities. While the nonregulated segment experienced some volatility, overall net income and diluted earnings per share showed positive trends compared to the prior year, indicating operational resilience and effective management of market risks. The divestiture of Georgia distribution operations was completed shortly after the quarter end, with the results already classified as discontinued operations.

Financial Statements
Beta
Gross Profit$432.75M
Operating Expenses$222.57M
Operating Income$210.18M
Interest Expense$33.33M
Net Income$116.42M
EPS (Basic)$1.28
EPS (Diluted)$1.27
Shares Outstanding (Basic)90.53M
Shares Outstanding (Diluted)91.49M

Key Highlights

  • 1Total operating revenues increased to $1.31 billion for the three months ended March 31, 2013, up from $1.23 billion in the prior year.
  • 2Net income rose to $116.4 million for the three months ended March 31, 2013, from $109.1 million in the same period last year.
  • 3Diluted earnings per share (EPS) from continuing operations were $1.23 for the three months ended March 31, 2013, up from $1.12 in the prior year.
  • 4The company successfully issued $500 million in new senior notes and used proceeds to repay short-term debt, strengthening its long-term financial position.
  • 5Capital expenditures increased significantly to $389.1 million for the six months ended March 31, 2013, compared to $311.1 million in the prior year, reflecting investment in infrastructure.
  • 6The company reported positive contributions from its regulated operations, which accounted for 91% of consolidated net income from continuing operations.
  • 7Divestiture of Georgia natural gas distribution operations was completed on April 1, 2013, and its results are classified as discontinued operations for the reporting periods.

Frequently Asked Questions

Atmos Energy reported an increase in operating revenues and net income for both the three- and six-month periods ended March 31, 2013, compared to the prior year. Diluted earnings per share also showed improvement, indicating a positive financial trend.

Atmos Energy strengthened its financial position by issuing $500 million in new senior notes and using the proceeds to repay short-term debt. The company also amended its credit facilities to enhance borrowing capacity and liquidity, ensuring it has over $1 billion in working capital funding.

Revenue and profitability are primarily driven by the natural gas distribution segment, influenced by customer demand (especially in winter), the cost of natural gas, and regulatory rate decisions. The regulated transmission and storage segment contributes through transportation volumes, while the nonregulated segment's performance is tied to asset optimization and market volatility.

Yes, Atmos Energy completed the sale of its Georgia natural gas distribution operations on April 1, 2013. The financial results for these operations have been classified as discontinued operations for the reporting periods presented in this filing.