Atmos Energy (ATO) Q2 Earnings Beat, Revenues Lag Estimates
Atmos Energy Corporation ATO posted second-quarter fiscal 2023 earnings of $2.48 per share, which surpassed the Zacks Consensus Estimate of $2.47 by 0.4%. The bottom line improved by 4.6% from the year-ago quarter’s earnings of $2.37 per share.
The year-over-year increase in earnings was due to a new rate implemented in both segments, increased weather and consumption and customer growth in its distribution segment. These positives were partially offset by higher operation and maintenance expenses and higher depreciation and property tax expenses due to increased capital investments.
Revenues
Total revenues of $1,541 million lagged the Zacks Consensus Estimate of $1,855 million by 16.9%. The top line decreased 6.6% from the year-ago quarter’s reported figure of $1,649.8 million.
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 in fiscal second-quarter 2023 were $1,500.2 million, a 6.9% decline from $1,610.6 million in the year-ago quarter.
Pipeline and Storage: Revenues from the segment were $184.4 million, a 12.6% increase from $163.8 million in the year-ago quarter.
Highlights of the Release
The purchased gas cost for fiscal second-quarter 2023 was $666.2 million, down 23.5% from the year-ago quarter. Operation and maintenance expenses were reported at $194.7 million, up 19.2% from the year-ago quarter.
The fiscal second-quarter 2023 results reported operating income of $422.6 million, up 9.7% from the year-ago quarter.
Atmos Energy incurred interest expenses of $37.4 million, up 29.4% from the year-ago quarter.
Financial Highlights
As of Mar 31, 2023, Atmos Energy reported a strong balance sheet with available liquidity of approximately $3.3 billion.
As of Mar 31, 2023, ATO had cash and cash equivalents of $95.2 million compared with $51.6 million as of Sep 30, 2022. As of Mar 31, 2023, long-term debt was $6,553.1 million compared with $5,760.7 million as of Sep 20, 2022.
Net cash flow provided by operating activities in fiscal first half of 2023 was $2,892.7 million compared with $640.5 million in the year-ago period.
Capital expenditures were reported at $795.7 million for the first half of 2023, with nearly 85% of the amount being related to system safety and reliability investments.
Guidance
Atmos Energy narrowed its fiscal 2023 earnings guidance in the range of $6.00-$6.10 per share from $5.90-$6.10 per share. The Zacks Consensus Estimate for fiscal 2023 earnings of $6.00 per share is lower than $6.05, the midpoint of the guided range.
ATO reiterated its fiscal 2023 capital expenditures, which will total to nearly $2.7 billion.
Zacks Rank
Atmos Energy currently has a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Other Releases
NextEra Energy, Inc. NEE released first-quarter 2023 adjusted earnings of 84 cents per share, which beat the Zacks Consensus Estimate of 75 cents by 12%.
The Zacks Consensus Estimate for NEE’s 2023 earnings per share is $3.11, implying year-over-year growth of 7.3%.
Entergy Corporation ETR reported first-quarter 2023 earnings of $1.14 per share, missing the Zacks Consensus Estimate of $1.34 by 14.9%.
The Zacks Consensus Estimate for ETR’s 2023 earnings per share is $6.69, implying a year-over-year increase of 4.2%.
ONE Gas Inc. OGS reported first-quarter 2023 operating earnings of $1.84 per share, which missed the Zacks Consensus Estimate of $1.85 by 0.54%.
The Zacks Consensus Estimate for OGS’s 2023 earnings per share is $4.14, suggesting year-over-year growth of 1.47%.
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