Summary
Atmos Energy Corporation (ATO) reported its financial results for the nine months ended June 30, 2019, demonstrating continued investment in its infrastructure and a focus on regulatory recovery mechanisms. Total operating revenues for the period were $2.46 billion, a decrease from the prior year, primarily due to lower purchased gas costs. Net income for the nine months stood at $453.0 million, or $3.88 per diluted share, compared to $564.3 million, or $5.09 per diluted share, in the prior year. However, when adjusted for a one-time tax benefit in the prior year, adjusted net income showed an increase, highlighting the company's operational progress. The company continued its aggressive capital expenditure program, investing $1.2 billion in its distribution and pipeline systems to enhance safety and reliability, with a significant portion of these investments being eligible for timely recovery through regulatory mechanisms. Financing for these investments was secured through a combination of operating cash flows, debt issuance, and equity offerings, including the issuance of new senior notes and common stock. The company also maintained a strong liquidity position and compliance with debt covenants.
Financial Highlights
45 data points| Revenue | $485.74M |
| Cost of Revenue | $31.33M |
| Gross Profit | $454.41M |
| Operating Income | $122.20M |
| Interest Expense | $19.59M |
| Net Income | $80.47M |
| EPS (Basic) | $0.68 |
| EPS (Diluted) | $0.68 |
| Shares Outstanding (Basic) | 118.08M |
| Shares Outstanding (Diluted) | 118.43M |
Key Highlights
- 1Net income for the nine months ended June 30, 2019, was $453.0 million ($3.88 per diluted share), compared to $564.3 million ($5.09 per diluted share) in the prior year. Adjusted net income, excluding the prior year's one-time tax benefit, increased by 14% year-over-year.
- 2Capital expenditures totaled $1.2 billion for the nine-month period, primarily focused on improving the safety and reliability of distribution and transportation systems, with over 80% of spending allocated to these areas.
- 3The company successfully implemented new rate adjustments and achieved positive outcomes in regulatory proceedings, leading to a $53.7 million increase in annual operating income during the first nine months of fiscal 2019.
- 4Contribution Margin for the Distribution segment increased by $20.2 million year-over-year, driven by rate adjustments and customer growth, despite a decrease in gas sales volumes.
- 5The Pipeline and Storage segment saw a significant increase in Contribution Margin of $46.7 million, driven by rate adjustments and favorable supply/demand dynamics in the Permian Basin.
- 6Total debt-to-capitalization ratio remained healthy at 41% as of June 30, 2019, well within the 70% covenant limit.
- 7Atmos Energy raised approximately $2 billion in long-term debt and equity financing during the nine months ended June 30, 2019, to support capital expenditures, repay debt, and for general corporate purposes.