Attached files
| file | filename |
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| 8-K - OGS 2015 Q3 ER - ONE Gas, Inc. | ogsq32015er8-k.htm |
Exhibit 99.1
October 28, 2015 | Analyst Contact: | Andrew Ziola 918-947-7163 | |
Media Contact: | Jennifer Rector 918-947-7571 | ||
ONE Gas Announces Third-quarter 2015 Financial Results;
Updates 2015 Financial Guidance
Declares Fourth-quarter Dividend
TULSA, Okla. - October 28, 2015 - ONE Gas, Inc. (NYSE: OGS) today announced financial results for its third quarter 2015, updated its full-year 2015 guidance and declared its quarterly dividend.
Highlights include:
• | Third-quarter 2015 net income was $7.4 million, or $0.14 per diluted share, compared with $4.7 million, or $0.09 per diluted share, in the third quarter 2014; |
• | Updated 2015 net income guidance to the range of $113 million to $118 million, compared with the previous guidance range of $108 million to $118 million; and |
• | The board of directors declared a quarterly dividend of 30 cents per share, or $1.20 per share on an annualized basis, payable on Dec. 1, 2015, to shareholders of record at the close of business on Nov. 13, 2015. |
“Our focus is to continue serving our customers safely and reliably,” said Pierce H. Norton II, president and chief executive officer. "We are on track with our capital investment plan, which demonstrates our commitment to pipeline system integrity. I want to thank our 3,400 employees who demonstrate our values and provide industry-leading customer service every day."
THIRD-QUARTER 2015 FINANCIAL PERFORMANCE
ONE Gas reported operating income of $24.9 million in the third quarter 2015, compared with $19.1 million in the third quarter 2014.
Net margin increased by $4.0 million compared with third quarter 2014, due primarily to a $4.6 million increase from new rates primarily in Oklahoma and Texas.
Third-quarter 2015 operating costs were $111.6 million, compared with $116.2 million in the third quarter 2014, which primarily reflects:
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ONE Gas Announces Third-quarter 2015 Financial Results;
Updates 2015 Financial Guidance; Declares Fourth-quarter Dividend
October 28, 2015
Page 2
• | A $3.9 million decrease in information technology expenses, which includes $3.3 million of costs associated with the separation from ONEOK, Inc.; |
• | A $1.6 million decrease in outside service expenses and other costs associated with pipeline maintenance activities; |
• | A $1.1 million decrease in ad valorem taxes; |
• | A $0.6 million decrease in fleet-related expenses; |
• | A $0.5 million decrease in bad debt expense due primarily to warmer weather in Kansas; and |
• | A $3.7 million increase in employee-related expenses. |
Third-quarter 2015 depreciation and amortization expense was $34.0 million, compared with $31.2 million in the third quarter 2014. This increase was due primarily to an increase in depreciation expense from capital investments placed in service.
Capital expenditures were $74.3 million for the third quarter 2015, compared with $76.0 million in the third quarter 2014.
Key Statistics: More detailed information is listed on page 13 in the tables.
• | Residential natural gas sales volumes were 7.5 billion cubic feet (Bcf) in the third quarter 2015, down 5 percent compared with the same period last year; |
• | Total natural gas sales volumes were 11.4 Bcf in the third quarter 2015, down 5 percent compared with the same period last year; |
• | Natural gas transportation volumes were 43.1 Bcf in the third quarter 2015, down 1 percent compared with the same period last year; and |
• | Total natural gas volumes delivered were 54.5 Bcf in the third quarter 2015, down 2 percent compared with the same period last year. |
YEAR-TO-DATE 2015 FINANCIAL PERFORMANCE
Operating income for the nine-month 2015 period was $165.2 million, compared with $155.3 million for the same period last year.
Net margin increased by $7.5 million compared with the same period last year, which primarily reflects:
• | A $19.4 million increase from new rates primarily in Oklahoma and Texas; |
• | A $3.7 million increase attributed to residential customer growth primarily in Oklahoma; |
• | A $5.6 million decrease due to lower sales volumes, net of weather normalization, primarily from warmer weather for the nine-month 2015 period compared with the same period last year; |
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ONE Gas Announces Third-quarter 2015 Financial Results;
Updates 2015 Financial Guidance; Declares Fourth-quarter Dividend
October 28, 2015
Page 3
• | A $5.1 million decrease in line extension revenue, from commercial and industrial customers, and other revenues; |
• | A $3.2 million decrease in rider and surcharge recoveries due to a lower ad-valorem surcharge in Kansas and the expiration of the take-or-pay rider in Oklahoma, both of which were offset by lower amortization expense; and |
• | A $1.9 million decrease due primarily to lower transportation volumes from weather-sensitive customers in Kansas. |
Operating costs for the nine-month 2015 period were $346.5 million, compared with $353.5 million for the same period last year, which primarily reflects:
• | A $3.5 million decrease in information technology expenses, which includes $5.9 million of costs associated with the separation from ONEOK, offset partially by costs for maintenance agreements; |
• | A $3.5 million decrease in outside service expenses associated with pipeline maintenance activities; |
• | A $3.0 million decrease in legal and workers’ compensation expense; |
• | A $2.6 million decrease in ad valorem taxes; |
• | A $2.1 million decrease in bad debt expense due primarily to warmer weather in Kansas; and |
• | A $8.1 million increase in employee-related expenses. |
Depreciation and amortization expense for the nine-month 2015 period was $98.6 million, compared with $94.0 million for the same period last year. This increase was due to an $8.3 million increase in depreciation expense from capital investments placed in service, offset partially by a $2.9 million decrease associated with the ad-valorem surcharge rider in Kansas and take-or-pay rider in Oklahoma.
Capital expenditures for the nine-month 2015 period were $199.7 million, compared with $224.6 million for the same period last year, due primarily to information technology assets acquired in 2014 due to the separation from ONEOK.
The company ended the third quarter with $53.0 million of cash and cash equivalents, no short-term borrowings and $1.0 million in letters of credit, leaving $699 million of credit available under its $700 million credit facility. The total debt-to-capitalization ratio at Sept. 30, 2015, was 40 percent.
> View earnings tables
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ONE Gas Announces Third-quarter 2015 Financial Results;
Updates 2015 Financial Guidance; Declares Fourth-quarter Dividend
October 28, 2015
Page 4
REGULATORY ACTIVITY
Oklahoma
In July 2015, Oklahoma Natural Gas filed a request with the Oklahoma Corporation Commission (OCC) for an increase in base rates, reflecting system investments and operating costs necessary to maintain the safety and reliability of its natural gas distribution system. Oklahoma Natural Gas’ request, if approved, represents an increase of $50.4 million in base rates and would result in a typical residential customer paying $4.98 more per month for the utility’s natural gas service.
The hearing on the merits of the request will occur in November 2015. In accordance with Oklahoma law, the OCC has 180 days to consider Oklahoma Natural Gas’ proposed rate changes.
Texas
In March 2015, Texas Gas Service filed under the El Paso Annual Rate Review (EPARR) requesting an increase in revenues in the City of El Paso and surrounding incorporated cities. In August 2015, the incorporated cities in the El Paso service area approved an increase in revenues of $8.55 million for the El Paso service area, of which $8.0 million is applicable to the incorporated cities.
The EPARR provides for a streamlined review of Texas Gas Service’s revenue requirement on an annual basis, and is in lieu of a filing under the Gas Reliability Infrastructure Program (GRIP) statute.
GRIP is a capital-recovery mechanism that allows for a rate adjustment providing recovery of and a return on incremental capital investments made between rate cases.
In the normal course of business, Texas Gas Service has received approval for increases totaling $4.7 million in 2015 for rate relief under the GRIP and cost-of-service adjustments in other Texas jurisdictions to address investments in rate base and changes in cost of service.
Kansas
Kansas Gas Service filed a request for interim rate relief under the Gas System Reliability Surcharge (GSRS) rider in August 2015 for an increase in customers' bills totaling approximately $2.4 million, effective January 2016. GSRS is a capital-recovery mechanism that allows for a rate adjustment providing recovery of and a return on incremental safety-related and government-mandated capital investments made between rate cases. The Kansas Corporation Commission has 120 days to render a decision on the request.
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ONE Gas Announces Third-quarter 2015 Financial Results;
Updates 2015 Financial Guidance; Declares Fourth-quarter Dividend
October 28, 2015
Page 5
Kansas Gas Service is expected to file a rate case in 2016 based on a 2015 test year, with new rates effective January 2017.
2015 FINANCIAL GUIDANCE UPDATED
ONE Gas 2015 net income is expected to be in the range of $113 million to $118 million, compared with its previously announced range of $108 million to $118 million. The updated guidance reflects lower operating and interest expenses, offset partially by lower net margin, compared with the guidance provided on Dec. 1, 2014.
Capital expenditures are still expected to be approximately $300 million in 2015. More than 70 percent of these expenditures are targeted for system integrity and replacement projects.
Additional information is available in the guidance table on the ONE Gas website.
EARNINGS CONFERENCE CALL AND WEBCAST
The ONE Gas executive management team will conduct a conference call on Thurs., Oct. 29, 2015, at 11 a.m. Eastern Daylight Time (10 a.m. Central Daylight Time). The call also will be carried live on the ONE Gas website.
To participate in the telephone conference call, dial 800-479-9001, pass code 793678, or log on to www.onegas.com.
If you are unable to participate in the conference call or the webcast, a replay will be available on the ONE Gas website, www.onegas.com, for 30 days. A recording will be available by phone for seven days. The playback call may be accessed at 888-203-1112, pass code 793678.
LINK TO EARNINGS TABLES
http://www.onegas.com/~/media/OGS/Earnings/2015/OGS_Q3Earnings-92Lk$CqzA.ashx
NON-GAAP (GENERALLY ACCEPTED ACCOUNTING PRINCIPLES) FINANCIAL MEASURES
ONE Gas has disclosed in this news release cash flow from operations before changes in working capital, which is a non-GAAP financial measure. Cash flow from operations before changes in working capital is used as a measure of the company's financial performance. Cash flow from operations before changes in working capital is defined as net income adjusted for depreciation and amortization, deferred income taxes, and certain other noncash items.
The non-GAAP financial measure described above is useful to investors as an indicator of financial performance of the company's investments to generate cash flow sufficient to support
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ONE Gas Announces Third-quarter 2015 Financial Results;
Updates 2015 Financial Guidance; Declares Fourth-quarter Dividend
October 28, 2015
Page 6
our capital expenditure programs and pay dividends to our investors. ONE Gas cash flow from operations before changes in working capital should not be considered in isolation or as a substitute for net income or any other measure of financial performance presented in accordance with GAAP.
This non-GAAP financial measure excludes some, but not all, items that affect net income. Additionally, this calculation may not be comparable with similarly titled measures of other companies. A reconciliation of cash flow from operations before changes in working capital is included in the guidance table.
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ONE Gas, Inc. (NYSE: OGS) is a natural gas distribution company and the successor to the company founded in 1906 as Oklahoma Natural Gas Company, which became ONEOK, Inc. in 1980. On Jan. 31, 2014, ONE Gas officially separated from ONEOK into a stand-alone, 100 percent regulated, publicly traded natural gas utility.
ONE Gas trades on the New York Stock Exchange under the symbol "OGS," and is included in the S&P MidCap 400 Index.
ONE Gas provides natural gas distribution services to more than 2 million customers in Oklahoma, Kansas and Texas. ONE Gas is one of the largest publicly traded, 100 percent regulated, natural gas utilities in the United States.
ONE Gas is headquartered in Tulsa, Okla., and its companies include the largest natural gas distributor in Oklahoma and Kansas, and the third largest in Texas, in terms of customers.
Its largest natural gas distribution markets by customer count are Oklahoma City and Tulsa, Okla.; Kansas City, Wichita and Topeka, Kan.; and Austin and El Paso, Texas. ONE Gas serves residential, commercial, industrial, transportation and wholesale customers in all three states.
For more information, visit the website at http://www.ONEGas.com. For the latest news about ONE Gas, follow us on Twitter @ONEGasInc.
Some of the statements contained and incorporated in this news release are forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. The forward-looking statements relate to our anticipated financial performance, liquidity, management’s plans and objectives for our future operations, our business prospects, the outcome of regulatory and legal proceedings, market conditions and other matters. We make these forward-looking statements in reliance on the safe harbor protections provided under the Private Securities Litigation Reform Act of 1995. The following discussion is intended to identify important factors that could cause future outcomes to differ materially from those set forth in the forward-looking statements.
Forward-looking statements include the items identified in the preceding paragraph, the information concerning possible or assumed future results of our operations and other statements contained or incorporated in this news release identified by words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “should,” “goal,” “forecast,” “guidance,” “could,” “may,” “continue,” “might,” “potential,” “scheduled,” and other words and terms of similar meaning.
One should not place undue reliance on forward-looking statements, which are applicable only as of the date of this news release. Known and unknown risks, uncertainties and other factors may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by forward-looking statements. Those factors may affect our operations, markets, products, services and prices. In addition to any assumptions and other factors referred to specifically in connection with the forward-looking statements, factors that could cause our actual results to differ materially from those contemplated in any forward-looking statement include, among others, the following:
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Updates 2015 Financial Guidance; Declares Fourth-quarter Dividend
October 28, 2015
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• | our ability to recover operating costs and amounts equivalent to income taxes, costs of property, plant and equipment and regulatory assets in our regulated rates; |
• | our ability to manage our operations and maintenance costs; |
• | changes in regulation, including the application of market rates by state and local agencies; |
the economic climate and, particularly, its effect on the natural gas requirements of our residential and commercial industrial customers;
• | competition from alternative forms of energy, including, but not limited to, solar power, wind power, geothermal energy and biofuels; |
• | variations in weather, including seasonal effects on demand, the occurrence of storms and disasters, and climate change; |
• | indebtedness could make us more vulnerable to general adverse economic and industry conditions, limit our ability to borrow additional funds and/or place us at competitive disadvantage compared with competitors; |
• | our ability to secure reliable, competitively priced and flexible natural gas supply; |
• | the mechanical integrity of facilities operated; |
• | operational hazards and unforeseen operational interruptions; |
• | adverse labor relations; |
• | the effectiveness of our strategies to reduce earnings lag, margin protection strategies and risk mitigation strategies; |
• | our ability to generate sufficient cash flows to meet all our cash needs; |
• | changes in the financial markets during the periods covered by the forward-looking statements, particularly those affecting the availability of capital and our ability to refinance existing debt and fund investments and acquisitions; |
• | actions of rating agencies, including the ratings of debt, general corporate ratings and changes in the rating agencies’ ratings criteria; |
• | changes in inflation and interest rates; |
• | our ability to purchase and sell assets at attractive prices and on other attractive terms; |
• | our ability to recover the costs of natural gas purchased for our customers; |
• | impact of potential impairment charges; |
• | volatility and changes in markets for natural gas; |
• | possible loss of LDC franchises or other adverse effects caused by the actions of municipalities; |
• | payment and performance by counterparties and customers as contracted and when due; |
• | changes in regulation of natural gas distribution services, particularly those in Oklahoma, Kansas and Texas; |
• | changes in law resulting from new federal or state energy legislation; |
• | changes in environmental, safety, tax and other laws to which we and our subsidiaries are subject; |
• | advances in technology; |
• | population growth rates and changes in the demographic patterns of the markets we serve; |
• | acts of nature and the potential effects of threatened or actual terrorism, including cyber attacks and war; |
• | the sufficiency of insurance coverage to cover losses; |
• | the effects of our strategies to reduce tax payments; |
• | the effects of litigation and regulatory investigations, proceedings, including our rate cases, or inquiries; |
• | changes in accounting standards and corporate governance; |
• | our ability to attract and retain talented management and directors; |
• | the results of financing efforts, including our ability to obtain financing on favorable terms, which can be affected by various factors, including our credit ratings and general economic conditions; |
• | declines in the market prices of debt and equity securities and resulting funding requirements for our defined benefit pension plans; |
• | the ability to successfully complete merger, acquisition or divestiture plans, regulatory or other limitations imposed as a result of a merger, acquisition or divestiture, and the success of the business following a merger, acquisition or divestiture; |
• | the final resolutions or outcomes with respect to our contingent and other corporate liabilities related to the natural gas distribution business and any related actions for indemnification made pursuant to the Separation and Distribution Agreement with ONEOK; |
• | our ability to operate effectively as a separate, publicly traded company; and |
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ONE Gas Announces Third-quarter 2015 Financial Results;
Updates 2015 Financial Guidance; Declares Fourth-quarter Dividend
October 28, 2015
Page 8
• | the costs associated with increased regulation and enhanced disclosure and corporate governance requirements pursuant to the Dodd-Frank Wall Street Reform and the Consumer Protection Act of 2010. |
These factors are not necessarily all of the important factors that could cause actual results to differ materially from those expressed in any of our forward-looking statements. Other factors could also have material adverse effects on our future results. These and other risks are described in greater detail in Item 1A, Risk Factors, in our Annual Report. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these factors. Other than as required under securities laws, we undertake no obligation to update publicly any forward-looking statement whether as a result of new information, subsequent events or change in circumstances, expectations or otherwise.
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ONE Gas Announces Third-quarter 2015 Financial Results;
Updates 2015 Financial Guidance; Declares Fourth-quarter Dividend
October 28, 2015
Page 9
ONE Gas, Inc. | ||||||||||||||||
STATEMENTS OF INCOME | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
(Unaudited) | 2015 | 2014 | 2015 | 2014 | ||||||||||||
(Thousands of dollars, except per share amounts) | ||||||||||||||||
Revenues | $ | 225,226 | $ | 241,522 | $ | 1,158,543 | $ | 1,304,538 | ||||||||
Cost of natural gas | 54,724 | 75,070 | 548,226 | 701,757 | ||||||||||||
Net margin | 170,502 | 166,452 | 610,317 | 602,781 | ||||||||||||
Operating expenses | ||||||||||||||||
Operations and maintenance | 98,698 | 101,829 | 304,681 | 309,154 | ||||||||||||
Depreciation and amortization | 33,956 | 31,217 | 98,592 | 93,995 | ||||||||||||
General taxes | 12,897 | 14,287 | 41,818 | 44,348 | ||||||||||||
Total operating expenses | 145,551 | 147,333 | 445,091 | 447,497 | ||||||||||||
Operating income | 24,951 | 19,119 | 165,226 | 155,284 | ||||||||||||
Other income | 166 | 8 | 1,051 | 1,005 | ||||||||||||
Other expense | (1,884 | ) | (652 | ) | (2,840 | ) | (1,829 | ) | ||||||||
Interest expense, net | (11,233 | ) | (11,160 | ) | (33,592 | ) | (35,886 | ) | ||||||||
Income before income taxes | 12,000 | 7,315 | 129,845 | 118,574 | ||||||||||||
Income taxes | (4,629 | ) | (2,662 | ) | (50,017 | ) | (45,391 | ) | ||||||||
Net income | $ | 7,371 | $ | 4,653 | $ | 79,828 | $ | 73,183 | ||||||||
Earnings per share | ||||||||||||||||
Basic | $ | 0.14 | $ | 0.09 | $ | 1.52 | $ | 1.40 | ||||||||
Diluted | $ | 0.14 | $ | 0.09 | $ | 1.50 | $ | 1.38 | ||||||||
Average shares (thousands) | ||||||||||||||||
Basic | 52,408 | 52,361 | 52,627 | 52,353 | ||||||||||||
Diluted | 53,072 | 53,014 | 53,315 | 52,848 | ||||||||||||
Dividends declared per share of stock | $ | 0.30 | $ | 0.28 | $ | 0.90 | $ | 0.56 | ||||||||
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ONE Gas Announces Third-quarter 2015 Financial Results;
Updates 2015 Financial Guidance; Declares Fourth-quarter Dividend
October 28, 2015
Page 10
ONE Gas, Inc. | ||||||||
BALANCE SHEETS | ||||||||
September 30, | December 31, | |||||||
(Unaudited) | 2015 | 2014 | ||||||
Assets | (Thousands of dollars) | |||||||
Property, plant and equipment | ||||||||
Property, plant and equipment | $ | 5,040,313 | $ | 4,850,201 | ||||
Accumulated depreciation and amortization | 1,604,509 | 1,556,481 | ||||||
Net property, plant and equipment | 3,435,804 | 3,293,720 | ||||||
Current assets | ||||||||
Cash and cash equivalents | 52,974 | 11,943 | ||||||
Accounts receivable, net | 103,406 | 326,749 | ||||||
Materials and supplies | 33,400 | 27,511 | ||||||
Income tax receivable | 23,725 | 43,800 | ||||||
Natural gas in storage | 159,912 | 185,300 | ||||||
Regulatory assets | 31,703 | 50,193 | ||||||
Other current assets | 12,227 | 22,005 | ||||||
Total current assets | 417,347 | 667,501 | ||||||
Goodwill and other assets | ||||||||
Regulatory assets | 440,312 | 478,723 | ||||||
Goodwill | 157,953 | 157,953 | ||||||
Other assets | 54,905 | 51,313 | ||||||
Total goodwill and other assets | 653,170 | 687,989 | ||||||
Total assets | $ | 4,506,321 | $ | 4,649,210 | ||||
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ONE Gas Announces Third-quarter 2015 Financial Results;
Updates 2015 Financial Guidance; Declares Fourth-quarter Dividend
October 28, 2015
Page 11
ONE Gas, Inc. | ||||||||
BALANCE SHEETS | ||||||||
(Continued) | ||||||||
September 30, | December 31, | |||||||
(Unaudited) | 2015 | 2014 | ||||||
Equity and Liabilities | (Thousands of dollars) | |||||||
Equity and long-term debt | ||||||||
Common stock, $0.01 par value: authorized 250,000,000 shares; issued 52,598,005 shares and outstanding 52,151,279 shares at September 30, 2015; issued and outstanding 52,083,859 shares at December 31, 2014 | $ | 526 | $ | 521 | ||||
Paid-in capital | 1,762,508 | 1,758,796 | ||||||
Retained earnings | 71,746 | 39,894 | ||||||
Accumulated other comprehensive income (loss) | (4,751 | ) | (5,174 | ) | ||||
Treasury stock, at cost: 446,726 shares at September 30, 2015 | (19,108 | ) | — | |||||
Total equity | 1,810,921 | 1,794,037 | ||||||
Long-term debt, excluding current maturities | 1,201,306 | 1,201,311 | ||||||
Total equity and long-term debt | 3,012,227 | 2,995,348 | ||||||
Current liabilities | ||||||||
Current maturities of long-term debt | 7 | 6 | ||||||
Notes payable | — | 42,000 | ||||||
Accounts payable | 57,240 | 159,064 | ||||||
Accrued interest | 7,647 | 18,872 | ||||||
Accrued taxes other than income | 40,429 | 44,742 | ||||||
Accrued liabilities | 18,000 | 26,019 | ||||||
Customer deposits | 58,331 | 60,003 | ||||||
Regulatory liabilities | 41,337 | 32,467 | ||||||
Other current liabilities | 10,478 | 9,260 | ||||||
Total current liabilities | 233,469 | 392,433 | ||||||
Deferred credits and other liabilities | ||||||||
Deferred income taxes | 907,647 | 894,585 | ||||||
Employee benefit obligations | 274,073 | 287,779 | ||||||
Other deferred credits | 78,905 | 79,065 | ||||||
Total deferred credits and other liabilities | 1,260,625 | 1,261,429 | ||||||
Commitments and contingencies | ||||||||
Total liabilities and equity | $ | 4,506,321 | $ | 4,649,210 | ||||
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Updates 2015 Financial Guidance; Declares Fourth-quarter Dividend
October 28, 2015
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ONE Gas, Inc. | ||||||||
STATEMENTS OF CASH FLOWS | ||||||||
Nine Months Ended | ||||||||
September 30, | ||||||||
(Unaudited) | 2015 | 2014 | ||||||
(Thousands of dollars) | ||||||||
Operating activities | ||||||||
Net income | $ | 79,828 | $ | 73,183 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 98,592 | 93,995 | ||||||
Deferred income taxes | 19,384 | 2,828 | ||||||
Share-based compensation expense | 3,863 | 5,651 | ||||||
Provision for doubtful accounts | 2,951 | 5,019 | ||||||
Changes in assets and liabilities: | ||||||||
Accounts receivable | 220,392 | 216,219 | ||||||
Materials and supplies | (5,889 | ) | 6,238 | |||||
Income tax receivable | 20,075 | (4,862 | ) | |||||
Natural gas in storage | 25,388 | (51,192 | ) | |||||
Asset removal costs | (33,744 | ) | (34,963 | ) | ||||
Accounts payable | (104,948 | ) | (70,063 | ) | ||||
Accrued interest | (11,225 | ) | 7,521 | |||||
Accrued taxes other than income | (4,313 | ) | 11,060 | |||||
Accrued liabilities | (8,019 | ) | 15,977 | |||||
Customer deposits | (1,672 | ) | (43 | ) | ||||
Regulatory assets and liabilities | 64,368 | 23,308 | ||||||
Other assets and liabilities | (15,493 | ) | (49,868 | ) | ||||
Cash provided by operating activities | 349,538 | 250,008 | ||||||
Investing activities | ||||||||
Capital expenditures | (199,678 | ) | (224,619 | ) | ||||
Cash used in investing activities | (199,678 | ) | (224,619 | ) | ||||
Financing activities | ||||||||
Repayments of notes payable | (42,000 | ) | — | |||||
Repurchase of common stock | (24,122 | ) | — | |||||
Issuance of debt, net of discounts | — | 1,199,994 | ||||||
Long-term debt financing costs | — | (11,078 | ) | |||||
Cash payment to ONEOK upon separation | — | (1,130,000 | ) | |||||
Issuance of common stock | 4,471 | 1,330 | ||||||
Dividends paid | (47,178 | ) | (29,121 | ) | ||||
Cash provided by (used in) financing activities | (108,829 | ) | 31,125 | |||||
Change in cash and cash equivalents | 41,031 | 56,514 | ||||||
Cash and cash equivalents at beginning of period | 11,943 | 3,171 | ||||||
Cash and cash equivalents at end of period | $ | 52,974 | $ | 59,685 | ||||
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ONE Gas Announces Third-quarter 2015 Financial Results;
Updates 2015 Financial Guidance; Declares Fourth-quarter Dividend
October 28, 2015
Page 13
ONE Gas, Inc. | |||||||||||||||
INFORMATION AT A GLANCE | |||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
(Unaudited) | 2015 | 2014 | 2015 | 2014 | |||||||||||
(Millions of dollars, except as noted) | |||||||||||||||
Financial | |||||||||||||||
Net margin | $ | 170.5 | $ | 166.5 | $ | 610.3 | $ | 602.8 | |||||||
Operating costs | $ | 111.6 | $ | 116.2 | $ | 346.5 | $ | 353.5 | |||||||
Depreciation and amortization | $ | 34.0 | $ | 31.2 | $ | 98.6 | $ | 94.0 | |||||||
Operating income | $ | 24.9 | $ | 19.1 | $ | 165.2 | $ | 155.3 | |||||||
Capital expenditures | $ | 74.3 | $ | 76.0 | $ | 199.7 | $ | 224.6 | |||||||
Net margin on natural gas sales | $ | 143.2 | $ | 138.3 | $ | 515.5 | $ | 501.4 | |||||||
Transportation revenues | $ | 20.9 | $ | 20.2 | $ | 72.9 | $ | 74.9 | |||||||
Net margin, excluding other revenues | $ | 164.1 | $ | 158.5 | $ | 588.4 | $ | 576.3 | |||||||
Volumes (Bcf) | |||||||||||||||
Natural gas sales | |||||||||||||||
Residential | 7.5 | 7.8 | 79.0 | 84.8 | |||||||||||
Commercial and industrial | 3.7 | 3.8 | 25.5 | 26.9 | |||||||||||
Wholesale and public authority | 0.2 | 0.3 | 1.7 | 1.5 | |||||||||||
Total volumes sold | 11.4 | 11.9 | 106.2 | 113.2 | |||||||||||
Transportation | 43.1 | 43.7 | 150.6 | 159.0 | |||||||||||
Total volumes delivered | 54.5 | 55.6 | 256.8 | 272.2 | |||||||||||
Average number of customers (in thousands) | |||||||||||||||
Residential | 1,955 | 1,939 | 1,970 | 1,957 | |||||||||||
Commercial and industrial | 154 | 154 | 157 | 157 | |||||||||||
Wholesale and public authority | 3 | 3 | 3 | 3 | |||||||||||
Transportation | 13 | 12 | 12 | 12 | |||||||||||
Total customers | 2,125 | 2,108 | 2,142 | 2,129 | |||||||||||
Heating Degree Days | |||||||||||||||
Actual degree days | 9 | 55 | 6,008 | 6,746 | |||||||||||
Normal degree days | 67 | 67 | 6,000 | 6,002 | |||||||||||
Percent colder (warmer) than normal weather | (86.6 | )% | (17.9 | )% | 0.1 | % | 12.4 | % | |||||||
Statistics by State | |||||||||||||||
Oklahoma | |||||||||||||||
Average number of customers (in thousands) | 853 | 845 | 861 | 854 | |||||||||||
Actual degree days | 0 | 11 | 2,067 | 2,381 | |||||||||||
Normal degree days | 14 | 14 | 2,012 | 2,012 | |||||||||||
Percent colder (warmer) than normal weather | (100.0 | )% | (21.4 | )% | 2.7 | % | 18.3 | % | |||||||
Kansas | |||||||||||||||
Average number of customers (in thousands) | 629 | 625 | 636 | 635 | |||||||||||
Actual degree days | 9 | 43 | 2,824 | 3,331 | |||||||||||
Normal degree days | 52 | 52 | 2,965 | 2,965 | |||||||||||
Percent colder (warmer) than normal weather | (82.7 | )% | (17.3 | )% | (4.8 | )% | 12.3 | % | |||||||
Texas | |||||||||||||||
Average number of customers (in thousands) | 643 | 638 | 645 | 640 | |||||||||||
Actual degree days | 0 | 1 | 1,117 | 1,034 | |||||||||||
Normal degree days | 1 | 1 | 1,023 | 1,025 | |||||||||||
Percent colder (warmer) than normal weather | (100.0 | )% | — | % | 9.2 | % | 0.9 | % | |||||||
-more-
ONE Gas Announces Third-quarter 2015 Financial Results;
Updates 2015 Financial Guidance; Declares Fourth-quarter Dividend
October 28, 2015
Page 14
ONE Gas, Inc. | ||||||||||||
EARNINGS GUIDANCE* | ||||||||||||
Updated | Previous | |||||||||||
2015 | 2015 | |||||||||||
(Unaudited) | Guidance | Guidance | Change | |||||||||
(Millions of dollars) | ||||||||||||
Operating income | ||||||||||||
Net margin | $ | 840 | $ | 845 | $ | (5 | ) | |||||
Operations and maintenance | 417 | 422 | (5 | ) | ||||||||
Depreciation and amortization | 133 | 135 | (2 | ) | ||||||||
General taxes | 55 | 55 | — | |||||||||
Operating income | 235 | 233 | 2 | |||||||||
Other income (expense) | (2 | ) | (2 | ) | — | |||||||
Interest expense | (45 | ) | (47 | ) | 2 | |||||||
Income before income taxes | 188 | 184 | 4 | |||||||||
Income taxes | (72 | ) | (71 | ) | (1 | ) | ||||||
Net income | $ | 116 | $ | 113 | $ | 3 | ||||||
Capital expenditures | ||||||||||||
System integrity and replacements | $ | 208 | $ | 213 | $ | (5 | ) | |||||
Customer growth | 62 | 55 | 7 | |||||||||
Other | 30 | 32 | (2 | ) | ||||||||
Total capital expenditures | $ | 300 | $ | 300 | $ | — | ||||||
Updated | Previous | |||||||||||
2015 | 2015 | |||||||||||
Guidance | Guidance | Change | ||||||||||
(Millions of dollars) | ||||||||||||
Cash Flow | ||||||||||||
Net income | $ | 116 | $ | 113 | $ | 3 | ||||||
Depreciation and amortization | 133 | 135 | (2 | ) | ||||||||
Deferred taxes | 23 | (8 | ) | 31 | ||||||||
Other | 10 | 13 | (3 | ) | ||||||||
Cash flow from operations before changes in working capital | $ | 282 | $ | 253 | $ | 29 | ||||||
*Amounts shown are midpoints of ranges provided. | ||||||||||||