Summary
Atmos Energy Corporation (ATO) is providing an update on the financial impact of the severe winter storm in February 2021. The company now estimates its aggregated natural gas purchases for all jurisdictions during this period to be approximately $2.5 billion, with Texas accounting for about 95% of this cost. This represents a slight decrease from the previously estimated range of $2.5 billion to $3.5 billion. The company plans to finance these incremental gas purchases, due by March 25, 2021, through a combination of long-term debt, ATM equity proceeds, short-term debt, and cash, aiming to maintain strong investment-grade credit ratings. Despite the significant, albeit now more precisely estimated, gas costs, Atmos Energy reiterates its confidence in its previously announced earnings per diluted share guidance for fiscal year 2021, projecting a range of $4.90 to $5.10. The company also maintains its long-term strategy of 6% to 8% annual EPS growth, supported by its focus on system modernization. Investors should note the company's stated commitment to a balanced financing strategy and seeking necessary regulatory approvals to manage these costs effectively.
Key Highlights
- 1Atmos Energy's estimated aggregated natural gas purchases due to the February 2021 winter storm are now approximately $2.5 billion.
- 2Texas represents approximately 95% of the estimated $2.5 billion in gas purchases.
- 3The company has approximately $2.8 billion in total liquidity as of February 28, 2021, including $422 million in operating cash.
- 4Financing for gas purchases will utilize a mix of long-term debt, ATM equity proceeds, short-term debt, and cash.
- 5Atmos Energy aims to maintain strong investment-grade credit ratings through its financing strategy.
- 6The company reiterates its fiscal 2021 earnings per diluted share guidance of $4.90 to $5.10.
- 7The company continues to expect annual earnings per share growth in the range of 6% to 8% based on its system modernization strategy.