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Atmos Energy (ATO) Q1 Earnings Match Estimates, Revenues Lag

Atmos Energy Corporation ATO posted first-quarter fiscal 2022 earnings per share (EPS) of $1.86, in line with the Zacks Consensus Estimate.

Reported earnings improved 8.8% from the prior-year figure due to a rate increase in both segments and a positive impact of customer growth in the distribution segment. These upsides were marginally offset by increased system maintenance, depreciation and property tax expenses.

Revenues

Total revenues of $1,013 million lagged the Zacks Consensus Estimate of $1,091 million by 7.1%. However, the top line increased 10.8% from the year-ago reported figure.

Atmos Energy Corporation Price, Consensus and EPS Surprise

Atmos Energy Corporation price-consensus-eps-surprise-chart | Atmos Energy Corporation Quote

Segment Revenues

Distribution: Revenues from the segment increased 10.9% to $972.4 million from $876.7 million in the prior-year quarter.

Pipeline and Storage: Revenues from the segment increased 2% to $162.9 million from $159.7MILLION in the year-ago quarter.

Highlights of the Release

The purchased gas cost for the quarter was $371.2 million, up 28.8% from the year-ago period. Operation and maintenance expenses for the quarter were $159.1 million, up 14.8% from the year-ago period.

Operating income for the reported quarter was down 7.7% year over year to $275.9 million.

Atmos Energy incurred interest expenses of $19.9 million, down 0.5% from the year-ago period.

As of Dec 31, 2021, Atmos Energy had cash and cash equivalents of $264 million. ATO generated operating cash flow of $61.8 million, a $95.2-MILLION decrease compared with the year-ago reported figure. This was primarily due to the timing of gas cost recoveries under purchase gas cost mechanisms, partially offset by positive effects of successful rate case outcomes achieved in fiscal 2021.

As of Dec 31, 2021, Atmos Energy’s available liquidity was $3.1 billion.

Atmos Energy invested $684.2 million in the first quarter of fiscal 2022 to strengthen operations. Nearly 88% of capital spending was associated with system safety and increased reliability of services.

Guidance

Atmos Energy reiterated its fiscal 2022 earnings guidance in the range of $5.40-$5.60 per share. The Zacks Consensus Estimate for fiscal 2022 earnings of $5.52 per share is higher than $5.50, which is the midpoint of the guided range. ATO expects capital expenditure in the range of $2.4-$2.5 billion for fiscal 2022.

Zacks Rank

Atmos Energy currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Releases

MDU Resources Group MDU is slated to report fourth-quarter 2021 earnings on Feb 10 before market open. The Zacks Consensus Estimate for the fourth quarter’s EPS is pegged at 55 cents per share.

MDU Resources’ long-term (three to five years) earnings growth is currently pegged at 6.70%. The Zacks Consensus Estimate for MDU’s 2022 earnings implies year-over-year growth of 8.79%.

ONE Gas Inc. OGS is slated to report fourth-quarter 2021 earnings on Feb 23 after market close. The Zacks Consensus Estimate for the fourth quarter’s EPS is pegged at $1.12 per share.

ONE Gas’ long-term earnings growth is currently pegged at 5%. The Zacks Consensus Estimate for OGS’ 2022 earnings implies year-over-year growth of 5.9%.

Sempra Energy SRE is slated to report fourth-quarter 2021 earnings on Feb 25 before market open. The Zacks Consensus Estimate for the fourth quarter’s EPS is pegged at $2.02 per share.

Sempra Energy’s long-term earnings growth is currently pegged at 5.28%. The Zacks Consensus Estimate for SRE’s 2022 earnings implies year-over-year growth of 1.65%.


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