ONE Gas (OGS) Q1 2025 earnings summary

Executive summary

• Net income for Q1 2025 was $119.4 million ($1.98 per diluted share), up from $99.3 million ($1.75 per share) year-over-year, driven by new rates, disciplined expense management, and customer growth.

• Total revenues increased 23% to $935.2 million, supported by higher natural gas sales and new rates.

• System reliability was demonstrated during five major winter storms with no significant outages.

• Continued focus on employee engagement and safety, earning the American Gas Association Safety Award for the eighth consecutive year.

• Board declared a $0.67 per share quarterly dividend, annualized at $2.68 per share, payable June 3, 2025.

Financial highlights

• Natural gas sales revenue rose 25% to $870.4 million; transportation revenues up 8% to $43.8 million compared to Q1 2024.

• Operating income grew to $180.5 million from $145.9 million year-over-year.

• Cost of natural gas increased 34% to $512.5 million; operating expenses (excluding gas) up 5%.

• Capital expenditures and asset removal costs totaled $177.7 million, slightly down from $179.4 million in Q1 2024.

• Interest expense increased by $4.7 million year-over-year due to debt refinancing, higher commercial paper balances, and additional senior notes.

Outlook and guidance

• Expects to achieve the upper half of 2025 guidance: net income $254–$261 million and EPS $4.20–$4.32.

• 2025 capital investments, including asset removal, projected at ~$750 million, with $180 million for customer extensions.

• Five-year plan targets EPS CAGR of ~6% through 2029 with reduced capital intensity and funding needs.

• O&M expense growth expected to remain at or below 4% annually, with ongoing efficiency initiatives.

• Anticipates continued customer growth and infrastructure investment, supported by stable cash flows and access to capital markets.