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ONE Gas (OGS) Beats Q4 Earnings Estimates, Adds Customers

·3 min read

ONE Gas Inc. OGS reported fourth-quarter 2020 earnings of $1.09 per share, beating the Zacks Consensus Estimate of $1.06 by 2.8%.

The bottom line also improved 13.5% from the year-ago earnings, primarily owing to new rates, higher sales volumes in Kansas and Oklahoma, along with residential customer growth.

Total Revenues

The company recorded revenues of $484.2 million for the fourth quarter, which surpassed the Zacks Consensus Estimate of $461 million by 5.1%. The top line also improved 6.9% from the year-ago level.

ONE Gas, Inc. Price, Consensus and EPS Surprise

ONE Gas, Inc. Price, Consensus and EPS Surprise
ONE Gas, Inc. Price, Consensus and EPS Surprise

ONE Gas, Inc. price-consensus-eps-surprise-chart | ONE Gas, Inc. Quote

Quarterly Highlights

Residential natural gas sales volume for the fourth quarter was 42.9 billion cubic feet (Bcf), up 2.6% year over year. Total volumes delivered in the same period were 113.8 Bcf, down 0.5% from the year-ago period due to lower commercial and industrial sales volume.

Total operating expenses for the reported quarter increased 6.1% from the year-ago figure to $190.9 million.

Operating income for the reported quarter improved 3.9% year over year to $85.1 million.

For fourth-quarter 2020, ONE Gas’ customer base rose 1.4% from the year-ago period, primarily due to additions to the residential customer group.

It incurred net interest expenses of $15.4 million, down 1.9% from the prior-year figure.

Capital expenditures and asset removal costs were $134.3 million for the reported quarter compared with $121.2 million in the year-ago period, primarily due to increased system integrity activities and extension of services to new areas.

Financial Highlights

As of Dec 31, 2020, ONE Gas had cash and cash equivalents of $8 million compared with $17.9 million at 2019-end.

Long-term debt (excluding current maturities) was $1,582.2 million as of Dec 31, 2020 compared with $1,286.1 million in the corresponding period of 2019.

Cash provided by operating activities for 2020 was $364.5 million compared with $310.3 million in 2019.

Guidance

ONE Gas reaffirmed 2021 net income guided range of $198-$210 million and earnings per share expectation in the $3.68-$3.92 band. The midpoint of its EPS guidance is $3.80, lower than the current Zacks Consensus Estimate of $3.83 for the period.

Capital expenditure is expected to be $540 million for 2021, with more than 70% of the amount targeted for system integrity and the balance primarily for customer growth.

Zacks Rank

Currently, ONE Gas carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Releases

Sempra Energy SRE posted fourth-quarter 2020 operating earnings of $1.90 per share, beating the Zacks Consensus Estimate of $1.55 by 22.6%.

ONEOK Inc. OKE posted fourth-quarter 2020 operating earnings of 69 cents per share, lagging the Zacks Consensus Estimate of 74 cents by 6.8%.

Atmos Energy Corporation ATO posted fiscal first-quarter 2021 operating earnings of $1.71 per share, beating the Zacks Consensus Estimate of $1.58 by 8.2%.

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