ONE Gas Reports Impressive First Quarter 2025 Financial Performance and Declares Dividend

ONE Gas Reports Impressive First Quarter 2025 Financial Performance and Declares Dividend



ONE Gas, Inc., a prominent natural gas utility based in Tulsa, Oklahoma, has recently unveiled its financial results for the first quarter of 2025. The company, listed on the New York Stock Exchange under the symbol OGS, demonstrated a remarkable performance characterized by a robust increase in net income and operating income, edging closer to the anticipated financial guidance for the year.

Financial Highlights


In the first quarter of 2025, ONE Gas recorded a net income of $119.4 million, which translates to $1.98 per diluted share, showing a significant increase compared to $99.3 million, or $1.75 per diluted share, during the same period last year. This one-time surge in revenues can be attributed to a vigorous regulatory strategy and the company's vigilant expense management.

The colder-than-normal winter also played a crucial role in shaping the results, leading to a heightened demand for natural gas. Even though the average temperature within the service areas was 5% colder than the previous year and 16% colder than the 2023 first quarter, the company managed to offset some of this impact through its weather normalization mechanisms, ensuring that their operating income remained stable.

ONE Gas also declared a quarterly dividend of $0.67 per share ($2.68 on an annualized basis), marking a continuing trend of returning value to shareholders. This dividend is set to be distributed on June 3, 2025, to shareholders who are on record as of May 19, 2025.

Operational Performance


The total operating income reached $180.5 million, a noticeable increase from $145.9 million in the first quarter of 2024. The growth in operating income can substantially be attributed to a $51.9 million upturn from new pricing structures and a $2.3 million rise in residential sales due to increased customer base in both Oklahoma and Texas.

Despite the upswing, the company faced certain challenges, including an increase of $5.1 million in depreciation and amortization costs, a rise in ad valorem taxes by $4.7 million, and elevated employee-related expenses of $3.2 million due to strategic workforce investment and operational enhancements.

The net interest expense rose by $4.7 million primarily due to the issuance of additional senior notes in the previous year.

Future Outlook and Guidance


Looking ahead, ONE Gas anticipates achieving the upper range of its earlier financial guidance for 2025, which estimates net income between $254 million and $261 million, and earnings per diluted share between $4.20 and $4.32. Furthermore, the company plans to engage in capital expenditures of approximately $750 million in 2025, focusing majorly on system integrity and extending services to new clientele, earmarking $180 million for expansion projects alone.

Ongoing Regulatory Activities


In recent updates, the company undertook various regulatory initiatives crucial for its operational resilience and growth. Kansas Gas Service is currently seeking a $7.2 million rate increase through an application submitted to the Kansas Corporation Commission (KCC). Updates from Texas Gas Service are also notable, with requests for increases connected to the Gas Reliability Infrastructure Program aimed at bolstering service reliability.

With a clear trajectory aimed at robust growth and enhanced reliability, ONE Gas stands poised to maintain its position as a leading natural gas utility in the United States, serving over 2.3 million customers across Kansas, Oklahoma, and Texas. As the situation evolves, stakeholders are advised to stay attuned to forthcoming announcements through the company's official channels.

To keep abreast of the latest developments, investors and interested parties can tune into a live analyst call and webcast scheduled for May 6, 2025, at 11 a.m. Eastern Time; the call can be accessed via the ONE Gas website for further insights into the company's future strategies and operational updates.

Topics Financial Services & Investing)

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