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 O&M management, and customer growth.

• Total revenues increased 23% to $935.2 million, with operating income up 24% to $180.5 million.

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

• Employee engagement and safety culture remain high, with the company receiving the AGA Safety Award for the eighth consecutive year.

• Board declared a $0.67 per share dividend, payable June 3, 2025.

Financial highlights

• Natural gas sales revenue rose 25% to $870.4 million; transportation revenues up 8% to $43.8 million year-over-year.

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

• Operating cash flow was $277.5 million, up $169.2 million year-over-year, mainly due to regulatory asset recovery.

• 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 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, EPS $4.20–$4.32.

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

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

• O&M expense CAGR projected at 4% over five years, with ongoing efficiency improvements.

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